February 16, 2011
By Staff Reporter
By Andrew Bushe
DUBLIN — House prices are continuing to soar with property prices surging ahead by 44 percent in Dublin and surrounding counties last year, according to First Active, the building society recently floated on the stock exchange.
There is growing concern that returning emigrants — badly needed to alleviate the skills shortages in industry — will be turned off coming back by the lack of affordable homes.
According to First Active’s mix-adjusted house price index, there was a national increase of 27.8 percent in prices throughout the country.
The rate of increase for areas outside Dublin and the newly developing commuter locations in Wicklow, Kildare, Louth and Meath was 14.7 percent.
Property prices have been spiraling for three years now and are expected to continue to rise this year with increased rents bringing investors back into the market despite the loss of tax breaks.
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The First Active increase for Dublin is slightly higher than previous estimates from other building societies and estate agents which have ranged from about 35 to 40 percent.
Measures implemented by the government after the Bacon report appear to have failed to dampen the market.
Lower interest rates, a booming demand, higher rent prices and the continued buoyancy of the economy look set to push prices even higher.