Irish house price sustainability: a county-level analysis

Allen-Coghlan, Matthew; McQuinn, Kieran; O’Toole, Conor

doi:10.26504/rn20190401

Cited by 2 publications

(4 citation statements)

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“…This is in large part because of the macroprudential rules introduced by the Central Bank in 2015, which limit borrowing for house purchase based on loan-to-value (LTV) and loan-to-income criteria. Work by Allen-Coghlan et al (2019), suggests that Irish residential property did not display bubble dynamics and that house prices are in line with that level suggested by economic IJHMA 14,4 fundamentals. Nevertheless, the significant implications of Covid-19 for the Irish economy will have knock on effects for the Irish housing market.…”

Section: Economic Implications Of Covid-19supporting

confidence: 53%

The potential impact of Covid-19 on the Irish housing sector

Allen-Coghlan

McQuinn

2020

IJHMA

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Purpose This paper aims to examine the implications for the Irish housing market of the economic slowdown due to the Covid-19 virus. Design/methodology/approach In this paper, an inverted demand function for housing is augmented to include a residential market activity variable and estimate the impact on house prices of the decline in economic activity due to the virus-related measures. The likely future path of house prices based on two different recovery scenarios is also examined. Under both scenarios house prices are forecast to decline in the near term. Findings The scenario analysis presented here indicates that Irish house prices are set to fall over the next 18 months as a result of the Covid-19 downturn. This contraction in prices is due to the decline in household disposable income and the sharp fall-off in mortgage market activity, which will inevitably result from the administrative closedown implemented by the Irish authorities. Originality/value As such the approach builds on several studies which have examined both house price movements in general and the relationship between house prices and mortgage credit availability. The paper also draws on the latest analysis of the implications for the Irish economy of Covid-19 and the related administrative closure methods introduced by the public authorities.

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Section: Economic Implications Of Covid-19supporting

confidence: 53%

The potential impact of Covid-19 on the Irish housing sector

Allen-Coghlan

McQuinn

2020

IJHMA

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“…Traditionally, credit demand from those in professional occupations would have been served by the banking sector. Previous work (Corrigan et al, 2019;Allen-Coghlan et al, 2019) shows that there are acute affordability challenges in urban areas, particularly in and around Dublin. The high numbers of professionals in urban areas accessing the scheme is likely to be a reflection of this.…”

Section: Applicant Profilementioning

confidence: 99%

“…We use the 30 year fixed-rate comparison for the RIHL loan. We then use the FTB income levels estimated in Allen-Coghlan et al (2019) to calculate an illustrative rent-to-income ratio, and debt-service-to-income ratio for RIHL loans and commercial loans.…”

Section: Affordabilitymentioning

confidence: 99%

“…Recent research by Corrigan et al (2019) and Allen-Coghlan et al (2019) points to affordability pressures for potential first-time buyers (FTBs) and high housing cost pressures for renters. Stricter credit conditions on mortgages in the commercial sector, in particular in relation to the income leverage ratio, have been noted as a limiting factor in terms of accessing sufficient credit as house prices rose.…”

Section: Introductionmentioning

confidence: 99%

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Review of the rebuilding Ireland home loan scheme

O’Toole¹,

Slaymaker²

2020

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The mission of the Economic and Social Research Institute is to advance evidencebased policymaking that supports economic sustainability and social progress in Ireland. ESRI researchers apply the highest standards of academic excellence to challenges facing policymakers, focusing on 12 areas of critical importance to 21st century Ireland.The Institute was founded in 1960 by a group of senior civil servants led by Dr T.K. Whitaker, who identified the need for independent and in-depth research analysis to provide a robust evidence base for policymaking in Ireland.Since then, the Institute has remained committed to independent research and its work is free of any expressed ideology or political position. The Institute publishes all research reaching the appropriate academic standard, irrespective of its findings or who funds the research.The quality of its research output is guaranteed by a rigorous peer review process. ESRI researchers are experts in their fields and are committed to producing work that meets the highest academic standards and practices.The work of the Institute is disseminated widely in books, journal articles and reports. ESRI publications are available to download, free of charge, from its website. Additionally, ESRI staff communicate research findings at regular conferences and seminars.The ESRI is a company limited by guarantee, answerable to its members and governed by a Council, comprising 14 members who represent a cross-section of ESRI members from academia, civil services, state agencies, businesses and civil society. The Institute receives an annual grant-in-aid from the Department of Public Expenditure and Reform to support the scientific and public interest elements of the Institute's activities; the grant accounted for an average of 30 per cent of the Institute's income over the lifetime of the last Research Strategy. The remaining funding comes from research programmes supported by government departments and agencies, public bodies and competitive research programmes.

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Irish house price sustainability: a county-level analysis

Cited by 2 publications

References 3 publications

The potential impact of Covid-19 on the Irish housing sector

The potential impact of Covid-19 on the Irish housing sector

Review of the rebuilding Ireland home loan scheme

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