February 17, 2011
By Staff Reporter
The Paris-based think-tank is due to publish a hugely positive report on the Irish economy with predictions that it will grow by five percent next year. The report will say that there is no chance of a fall in property values in the next two years and that instead they will continue to rise.
The OECD believes that house prices can grow up to eight percent in each of the next two years without running the risk of a collapse in the residential property market. The Irish housing market has been fuelled in recent years by a growing population and low interest rates.
Glowing in its analysis of the Irish economy, the report is expected to be music to the ears of Fianna Fail coming a year before a general election. On the wider front it will state that the SSIA scheme, in which the government will return 25 percent on individual savings, will not drive up inflation.
With SSIAs due to pay out in May, the OECD believes there is only an outside chance that they will stoke inflation.
A recent house price survey revealed that house prices in Ireland grew by 9.3 percent in 2005 — up from 8.6 percent the previous year. The Permanent TSB House Price Index also found, unusually, that house prices actually accelerated throughout the year — unlike in other years where they taper off towards the end.
House price growth in the second half of the year was 6.7 percent — compared to 2.5 percent in the first half. In 2004, the respective figures were 3.7 percent and 4.7 percent.
The same survey found that the cost of houses for first time buyers increased more rapidly than those for second-time buyers. People looking to buy their first home saw prices increase by 12.7 percent compared with 8.3 percent for second time buyers. The average price in Ireland for a first time buyer was