Irish 2010 house prices to fall 10 percent

Published 25th Jan 2010

Asking prices for residential housing in Ireland are expected to fall by 10 percent this year, with the prospect of some stabilisation in the second half, property website MyHome.ie said on Wednesday.

The website's forecast compares with the median projection for an 11.9 percent decline in house prices in 2010 according to a Reuters poll of economists last month.

MyHome.ie, which says 1,200 estate agents list properties on its pages, said low interest rates and the fresh credit to be provided by Dublin's "bad bank" project, the National Asset Management Agency, would encourage buyers later this year.

"Whilst the economy is forecast to move out of recession from the middle of the year onwards, a true 'bottoming out' for the residential property market will only happen once unemployment peaks and employment levels return to growth again," MyHome.ie said in a survey.

The Reuters poll showed economists expected unemployment, which often lags economic recovery, to reach 13.6 percent at the end of this year versus a projected 12.6 percent in late 2009.

NAMA will pay around 54 billion euros to take over shaky commercial property loans from banks including Allied Irish Banks (ALBK.I: Quote, Profile, Research) and Bank of Ireland (BKIR.I: Quote, Profile, Research) to cleanse their balance sheets and improve the flow of credit in the economy.

MyHome.ie, which said asking prices had fallen almost a quarter since their peak at the end of a decade-long bubble in 2007, forecast 11,000 new private housing units would be built this year, a fraction of 90,000 units in 2006.

Source: ' Reuters '

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