Wednesday, December 18 16:08:05
The vast majority of Irish chief executives (88pc) are more optimistic about Irish economic prospects compared to 12 months ago, according to a new survey from commercial property consultants CBRE.
Their study found that the same percentage (88pc) believe that Ireland will be viewed even more favourably at the end of 2014.
Encouragingly, 98pc of respondents to the annual survey expect Irish Gross Domestic Product (GDP) to increase in 2014 with more than two thirds of chief executives who responded to the CBRE survey expecting the Irish economy to grow by between 1pc and 2pc next year.
Only 5pc of respondents expect economic growth of more than 2pc to be achieved next year. 70pc of respondents expect Eurozone interest rates to remain at current levels next year while 22pc expect a slight increase in interest rates in 2014. Only 1pc of CEO's expects a significant increase in interest rates in the Eurozone next year. 66pc of respondents expect a slight improvement in the availability of funding for businesses and households next year with a further 28pc of Ireland's chief executives expecting no change in the availability of funding in 2014. When asked what issue had the most significant negative impact on economic activity in Ireland in 2013, the greatest majority of respondents cited the domestic economic banking crisis. One of the more notable findings of this year's survey was the extent to which Irish CEO's have moved away from bank deposit as a preferred form of investment over the course of the last 12 months with both residential and commercial property proving considerably more attractive compared to last year. 76pc of respondents say they are more favourable to Irish residential property over the last 12 months while 68pc of respondents say they are more favourable to Irish commercial property than they were at the end of 2013. 53pc say they are more favourable to equities compared to last year. Meanwhile, 85pc of respondents say they are less favourable towards bank deposits compared to 12 months ago.
Almost half of respondents (48pc) expect Dublin house prices to increase significantly over the next 3 year period while a further 17pc expect house prices in the capital to increase slightly in the period. 8pc expect no change in Dublin house prices over the next 3 year period while 27pc are forecasting further price falls in the Dublin housing market. Outside of Dublin, respondents are more cautious about house price growth prospects. Although 68pc of respondents are predicting increases in house prices outside of the capital over the next 3 year period, almost all of these are predicting only a slight increase in prices. 35pc are predicting either no increase or further falls in house prices outside of the capital in the period.
Respondents were more upbeat about expectations for Dublin commercial property values than residential property prices over the next 3 year period. According to Marie Hunt, Head of Research at CBRE "94pc of Irish CEO's who responded to our 2014 survey expect Dublin commercial property prices to increase further over the next 3 year period. 51pc of respondents are predicting a slight increase in commercial property values in the period with a further 43pc predicting a significant increase.