Private bank Investec have upped their forecast on Irish housing completions to 19,000 this year and 21,000 in 2018, a growth of 3,000 houses in both cases.
While the bank says it will still be some time in the next decade before supply rises to meet demand, it increased its forecast “following impressive growth in completions” in the period to the end of May.
Additionally, in its third quarter Irish economy monitor, Investec said that Irish house price inflation has exceeded its expectations and it now expects a 10 per cent price rise in 2017 and a further 8 per cent next year.
Meanwhile, the company upgraded its forecast for GDP by 20 basis points to 4.8 per cent this year, while they project growth of 4.4 per cent in 2018.
“The upgrade for 2017 reflects a more optimistic view on investment, both underlying and from the multinational sector. Elsewhere, the public finances are getting back on track after a lukewarm start to the year, with the Minister for Finance now likely to preside over a general government deficit of less than 0.1% of GDP in 2017,” Investec’s Phillip O’Sullivan said in a client note.
Although mostly positive, Mr O’Sullivan again warned of Brexit and currency fluctuation risks. However, he noted that political risks within the Eurozone had receded since the beginning of this year. On the whole, Mr O’Sullivan suggested there is “strong momentum behind the economy heading into the year end.”
