Ireland won't meet housing demand for a decade

Property prices only going one way, says S&P...

Ireland won't meet housing demand for a decade

Activists outside Dublin's Apollo House | Image: Sean Defoe

Irish house prices will continue to increase for the next two years, according to ratings agency Standard & Poor's.

The cost for your home will climb 7% this year, and a further 5% in 2018.

S&P has forecast that it will take a decade for construction levels to reach a point where they can meet the demand for housing, such was the size of the hit the building sector took during the recession. This sluggish recovery has hampered the country's ability to increase supply in key areas.

Meanwhile, demand will be further fuelled by the Government's help-to-buy scheme, as well as population growth and a rise in disposable income.

The report states:

"The Irish housing market remains impaired by crisis legacy issues...

“The boost to households’ spending power, in particular in 2015 when economy-wide real disposable income rose by 4.6%, helped underpin the robust upward trend in house prices."

S&P analysts have estimated that household consumption may have now surpassed the pre-crisis level.

The report has said that the Government's plan to commission 37,000 social housing units by 2021 is ambitious:

"Shortages should persist over the medium term, despite a gradual recovery in household finances, and continue to underpin robust house price growth."

S&P's findings come as a new Barnardos report aims to shine a spotlight on the thousands of children that are currently homeless in Ireland.

The charity wants people to hear the real stories behind the figures, to highlight the impact that homelessness has on children.

The most recent figures show a record total of more than 7,148 people homeless in the country. Nationally, there are now 4,643 adults and 2,505 children homeless – meaning that one in three are children.

Homeless charity Focus Ireland has found that one in every nine people are worried that they will lose their home. Its latest survey showed that one third of people struggle to pay their rent or mortgage every month.