Property prices nationally rose by 8.1 per cent last year, while prices in the capital climbed by 5.7 per cent.
The latest property price index from the Central Statistics Office (CSO), however, shows the rate of house price growth unexpectedly slowed in December, bucking a trend of accelerating growth in 2016.
Prices nationally fell by 0.4 per cent in December, marking the first monthly reverse since March.
The latest property price numbers come on the back of the Government’s new tax incentive scheme for first-time buyers and a loosening of the Central Bank’s lending rules.
In Dublin, where supply shortages are most acute, prices were down 0.9 per cent in December.
On an annual basis, Dublin house prices increased 5.8 per cent whereas apartments increased by 7.9 per cent in the same period.
The highest house price growth was in South Dublin, at 9.7 per cent. In contrast, the lowest growth was in Fingal, with house prices rising just 3.2 per cent.
Prices in the rest of the country, excluding Dublin, were 12 per cent higher in the year to December.
The West region showed the greatest price growth, with house prices increasing 17.8 per cent while the Mid-East region showed the least price growth, with house prices increasing 7.6 per cent.
Overall, prices nationally are still 32.1 per cent lower than their 2007 peak . The figures show that from the trough in early 2013, prices nationally have increased by 49.1 per cent.
In the same period, Dublin residential property prices have increased 64.3 per cent whilst residential property prices in the rest of Ireland are 46.6 per cent higher.
Estate agency Savills said the slowdown in December was more likely to have been a temporary pause rather than a reversal of the long-term trend.
The rate of house price growth unexpectedly slowed in December - bucking a trend of accelerating house price growth through since early last year.
“Towards the end of last year there was much speculation about two potential housing policy changes - the possible easing of mortgage lending restrictions and the prospect of a new help-to-uy scheme,” John McCartney, director of research at Savills said.
“Anticipation of these measures almost certainly caused some potential buyers to hold off in the belief that they would have more buying power if these policies came to fruition,” he said.
Dr McCartney said Property Price Register data show that house sales fell by 23 per cent year-on-year in December.
Merrion analyst Alan McQuaid said a lack of supply had clearly pushed up prices, particularly in the Dublin area in the past few years, but this was not something that could be rectified overnight.
“Until this issue is addressed, prices in the capital and its outskirts will likely remain elevated, even with Brexit related risks,” he said.
Mr McQuaid said the easing of mortgage lending restrictions and the tax-incentive scheme for first-time buyers would keep upward pressure on prices until new supply comes on the market.
“The real question is whether we need this type of incentive at all, with politicians seemingly not learning their lesson from the property crash/financial crisis,” he said,
