The number of new homes built this year will fall short of the government’s target of building 29,000, according to forecasts by Davy.
The stockbrokers’ latest research has found that housing completions will drop from last year’s figure of nearly 30,000 to 27,500 in 2023, which means the government is unlikely to hit its target of 29,000.
It expects residential house price inflation to slow to 4% this year but says a ‘key uncertainty’ remains what happens as a result of the loosening of the Central Bank’s mortgage lending rules.
It says it’s possible ‘given the intensity of competition in the housing market’ that first-time buyers may take on more debt and push prices higher than its 4% forecast.
Davy has also doubled its growth forecast for the Irish economy on the back of a stronger-than-expected performance last year, falling energy prices and a “less challenging” global outlook.
The firm said it expected Irish GDP (gross domestic product) to grow by 6.9% this year, up from a previous forecast of 3.5%, and by 5% next year.
