KBC Bank Ireland have today released the second research findings of the KBC Homebuyer Sentiment survey. The survey highlights that while attention is rightly focused on inadequate levels of new housing supply, the current strength of Irish house prices also owes a great deal to pent-up demand that is now emerging with some force.
The survey finds a strong pipe-line of demand is now emerging as depressed home sales in recent years mean many consumers are experiencing a mismatch between their current housing circumstances and the accommodation they want.
The survey suggests only half (49%) of Irish consumers are entirely content with their current housing circumstances. Another fifth (23%) are not in a position to contemplate home-buying. This means that about one in four consumers (28%) is now at least considering buying a home in the next two years with roughly half of these already planning their purchase.
The KBC Homebuyer survey finds little evidence of a ‘buyer frenzy’ in as much as would-be purchasers are slightly more cautious about their own household finances and the outlook for the broader economy. Instead, there are signs of significant frustration that buying plans may not be realised with less than half of those surveyed (47%) notably confident they will have bought within a two year timeframe.
Of those now able and willing to buy, roughly equal numbers are first-time buyers (38%) and movers (38%), with demand from investors (23%) accounting for a smaller proportion.
However, the survey finds that the proportion of first-time buyers at the early stages of the home-buying process is increasing markedly to around half of potential purchasers (53%).
This step-up may be the result of greater confidence in the economic outlook and could also reflect improved access to credit but as these aspects affect all potential purchasers more important influences may be the Governments ‘help to buy’ scheme and the easing of the Central Bank’s lending limits.
Commenting on the data, Chief Economist KBC Bank Ireland, Austin Hughes said, "To properly understand what’s happening in the Irish property market today, we need to look at what is happening to demand as well as clearly inadequate supply. The KBC homebuyer survey suggests a pipeline of unsatisfied demand is building both because of new entrants to the property market and because many existing households face a significant mismatch between their current accommodation and the housing they need. In turn, this suggests the current pressures on housing may be even greater than is often suggested."
Source: www.businessworld.ie
