Today’s data from the CSO indicate that house prices are continuing to rise, but the rate of growth is now slowing in Dublin.  Dr. John McCartney, Director of Research at property consultants Savills, says this reflects new mortgage restrictions which impinge more heavily on the Dublin market where prices are higher.

The slowdown in growth comes despite a glut of house hunters seeking to close deals before their old-style mortgage approvals run out.  However, with the last of these expected to wash through the system by August, the impact on the property market remains to be seen;

“We may see a further cooling off in price growth from September when all the house hunters with legacy loan approvals have done their deals.   In the longer term, there could be an offsetting pick-up in investor activity as rising rents are making buy-to-let returns look increasingly more attractive than bank deposits.”

Savills calculates that the spread between returns on residential investment and banking deposits is currently two-and-a-half times what it was when buy-to-let activity was at its peak back in 2007.

Irish households currently have just under €93bn on deposit in Irish banks.