The new Central Bank mortgage restrictions will cause a moderation in new mortgage lending, but this will not occur until the second half of 2015, according to Goodbody Stockbrokers.

A research report published by the company says the Irish housing market is two years into a sustainable recovery, but supply at 11,000 units remains 88 per cent below peak levels, according to Goodbody Stockbrokers.

“We now expect gross lending growth of 29 per cent in 2015, followed by 11 per cent in 2016. The measures are aimed at preventing a repeat of the credit-fuelled housing bubble of the 2000s, and are something that we welcome”.

A research report published by the company says the first stage of the housing market recovery has been in prices, led by Dublin.

It said a normalisation of transactions, mortgage credit and supply over the coming years will improve the quality of this recovery.

However, the report said it may take until the end of the decade for supply to match expected household demand, given development and planning lags, construction sector capacity constraints and limited financing. The supply shortages are most acute in the greater Dublin area.

Housing completions grew for the first time in eight years in 2014. However, at 11,000 units, Goodbody says supply remains 88 per cent below peak levels.