There are now twice as many people approved for mortgages and entering the market as there are new houses for them to buy.
Figures from the Irish Banking and Payments Federation show that around 20,000 first-time buyers have been cleared for a home loan this year.
However The Irish Independent reports that only half that number of new properties are available on the market.
The average approval amount was €214,000 in March - up 9% on last year.
Charlie Weston, personal finance editor with the Irish Independent, said it is a tough time for buyers:
“There is possibly about 18,500 houses going to be built this year but most of those are self-builds that won’t be available to buy for new buyers,” he said. “So the problem here is there is just an acute shortage and prices of property will probably keep rising because of that.”
“It is a difficult situation for new buyers.”
The figures have added fuel to concerns that the country is facing another property bubble – despite assurances from the governor of the Central Bank that this is not the case.
Speaking at the launch of the Central Bank’s annual report on Wednesday, Philip Lane said mortgage restrictions limiting buyers from borrowing more than three-and-a-half times their income would put the brakes on “persistently” rising prices.
Property prices are rising at an annual rate of 11%.
A number of commentators have blamed the spiraling house prices on the government’s Help-to-Buy scheme for first-time buyers - and a loosening of the Central Bank rules on the size of deposits first-time buyers need.
Mr Lane said a lack of supply and a strengthening economy were among the factors driving up prices.
However, he confirmed that the bank would be conducting an annual review of its mortgage lending restrictions every November moving forward - adding that it was prepared to step in with new regulations if necessary.
According to recent opinion poll from the Sunday Independent/Kantar Millward Brown, 38% of Irish people believe we are heading towards another property collapse.
