Irish property prices undervalued by 5%

Irish property prices undervalued by 5%

The latest edition of The Economist

Irish residential property prices are undervalued, according to the latest edition of The Economist magazine, published at the weekend.

During the boom the influential London-based publication repeatedly warned that Irish house prices were overvalued and at risk of crashing.

In the latest of its regular surveys of house prices internationally it said that Irish prices are 5% lower than they should be.

The estimate is based on the long-run relationship between house prices on the one hand and incomes and rents on the other.

Of the 21 countries covered in the index, prices are undervalued in only six other countries, said The Economist.

Irish prices have fallen further than those in any of the other 20 countries, when measured against both 2007 and 2011.

While average Irish prices have halved over the past five years, the next worst performing market was the US, where prices fell by more than one-quarter.

Read more in The Irish Times.

There is 1 comment for this article
  1. Paddy the Prophet at 8:08 pm

    Enda Kenny said last weekend in his Michael Collins oration at Beal na mBlath “This year’s budget will be the toughest of our terms”.

    Property values will take another hit during 2013 as Irish residents have even less money available for rents and home loan repayments. Job insecurity is also a powerful deterrent to getting into debt just to be able say “I have rented money from the bank rather than renting a house”

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