Consumer sentiment towards the housing market has improved steadily, according to a new index from AIB/ESRI, which measures the perception consumers have in relation to the Irish housing market, as well as their house price expectations.

The index points to a “significant shift” in consumer expectations from July to December 2013, as the number of consumers surveyed who said they believed that house prices would be higher in 12 months’ time increased from 29.2 per cent to 46.3 per cent.

The main risks to buying noted in December by consumers was “worries about future income’” or “affordability concerns” (58.4%), followed by “fears about increasing interest rates” (17.7%). Also cited were “changes in family circumstances” (16.3%), as was “possible changes in house prices” (6.5%).

The main reasons for not buying noted by consumers surveyed included that they are “satisfied with their present dwelling” (54.6%), followed by “cannot afford it” (22%).

Overall, consumers expect that house prices will increase by 2.1 per cent over the next 12 months. Dublin-based consumers expect higher house price growth, with growth of 3.6 per cent expected over the next 12 months.

The survey was conducted amongst over 800 consumers between July and December 2013.