Irish house prices are predicted to rise more modestly this year following their budget-induced surge in 2002, according to the body representing auctioneers and valuers.
In its annual report published today the Irish Auctioneers' and Valuers' Institute (IAVI) said house values have picked up strongly after a brief decline in 2001 and prices rose by 10 to 14 per cent and by up to 25 per cent in select parts of Dublin, Cork & Galway.
House prices for 2003 are predicted to rise by a more modest 6 per cent.
Speaking at the launch of the IAVI Annual Property Survey 2002 today, IAVI chief executive Mr Alan Cooke said the return of confidence to the market was helped by Budget 2002, which restored mortgage interest relief and reduced some residential stamp duty rates to boost supply in the private rented sector.
"However, the principal factor driving the housing market continues to be the low interest rates we are now benefiting from," said Mr Cooke.
IAVI members were evenly divided on whether prices for first-time buyers would increase, or be unaffected, as a consequence of Budget 2003. However no agent felt that prices would fall as a consequence of the Budget changes.
Regarding the recent changes in relation to social housing, 59 per cent of IAVI members believe that these will increase the supply of new housing over the next two years.
The report states this figure would "undoubtedly have been higher had the changes been more builder-friendly than was first perceived."
A majority (82 per cent) of IAVI members believe the commercial property market has lost competitiveness as a result of stamp duty increases.
As a consequence, the IAVI believes investment will be driven out of the country to more investment friendly markets.
The IAVI represents over 1,600 qualified auctioneers, estate agents and valuers spread throughout the 32 counties and has more than 500 member firms including all the national agencies.