Home > Property > Four in five think house prices will rise over the coming year

Four in five think house prices will rise over the coming year

Written by Robert McHugh, on 29th May 2017. Posted in Property

article headline

Bank of Ireland has released its latest Economic Pulse survey today which conducted by Ipsos MRBI on behalf of Bank of Ireland with 1,000 households and over 2,000 businesses on a range of topics including the economy, their financial situation, spending plans, house price expectations and business activity.  
 
The Bank of Ireland Economic Pulse stood at 92.4 in May 2017. The index, which combines the results of the Consumer and Business Pulses, was down 2.7 on April’s reading and 8.9 on this time last year.
 
Household confidence held up reasonably well amid much activity on the international stage – as did sentiment among firms in the industry, retail and construction sectors. However, the Services Pulse fell back in the month, which pulled down the Business Pulse.
 
At 94.1, the Consumer Pulse was broadly unchanged in May 2017. Households were slightly more upbeat about the current economic situation this month, but a bit unsure about their own finances. The buying climate remained positive though, with 38% considering it a good time to purchase big ticket items such as furniture and electrical goods (the same as in April), while 27% expect to increase instore spending over the coming year and one in five expect to spend more online.
 
The Business Pulse came in at 92.0 in May 2017, down 3.3 on April and a drop of 11 on this time last year. The softer reading this month owes much to the Services Pulse, which gave up last month’s strong gains. More positively, sentiment among industrial firms and retailers increased in May, with the construction sector also putting in a good performance and leading the charge on the hiring intentions front. 

While the majority of businesses do not expect to change their selling prices in the period ahead, the survey finds that builders are more likely to pass on rising input costs (excluding labour) with just over one in three looking to increase prices in the next 3 months.
 
Meanwhile, the Housing Pulse stood at 115.3 in May 2017. This was down 0.9 on last month’s record high but up 11.3 on a year ago. The findings show that four in five think house prices will rise over the coming year, while 70% expect rents to increase. 

The market continues to be characterised by disequilibrium, with the new help-to-buy scheme for first time buyers and the loosening of the Central Bank’s loan-to-value restrictions for this group supporting demand, whereas a shortage of labour and uncertainty top the list of factors currently weighing on building activity.
 
Households in Munster were particularly upbeat about the current economic situation this month; whereas households in Connacht/Ulster were noticeably downbeat about their own finances. The May survey also finds that near-term prospects for business activity and hiring were in positive territory in all regions, with Dublin ahead on the jobs front.
 
Commenting on the survey, Group Chief Economist at Bank of Ireland, Dr. Loretta O’Sullivan said, "It has been an eventful few weeks with Prime Minister May calling a general election in the UK, the Presidential election in France, President Trump setting out his tax plans and the European Council announcing its guidelines for the Brexit negotiations."

She added, "These developments have resonated globally and are also important for Ireland. In terms of sentiment, we’re seeing a mixed picture this month, with consumers holding steady but some softness on the business side weighing on the headline Economic Pulse."

Source: www.businessworld.ie

More articles from Property

image Description

Irish house prices resilient despite rate rises

Read more
image Description

Irish hotel transactions increase in second quarter

Read more
image Description

Annual housing price inflation declining since peak in March 2022

Read more
image Description

Irish mortgage rates rise to highest level in over three years

Read more
image Description

Dublin office market activity in 2022 was 70% higher than in 2021

Read more