And, more specifically, is there a housing bubble emerging in Dublin?
We’re getting mixed answers from the Government to these questions.
Take, for example, comments by the Taoiseach during his St Patrick’s Day visit to the US last month, when he said pent up demand in the capital led some prices to jump by as much as €30,000 in a single weekend.
“If you had 30,000 three- bedroom detached houses in Dublin you’d sell them all in a week. That’s the pent-up demand that’s there,” he said.
In anyone's terms, that's a housing bubble, even if Enda Kenny may have been exaggerating in order to entice US investors to dip their toes in the Irish property market.
However, speaking yesterday in the Dáil and at separate functions, Minister for Finance Michael Noonan downplayed concerns that Dublin is about to go through 2005 to 2007 all over again, saying residential prices remain 47 per cent lower than the since the peak.
While saying he is “worried about the lack of family homes in the greater Dublin area in particular”, Mr Noonan said talk of another boom is “exaggerated”.
“We can relax for a little while anyway,” he said.
In the meantime, Government ministers, backbenchers and Opposition spokespeople have latched on to the fact that younger buyers in Dublin are finding it extraordinarily difficult to buy suitable homes.
Policy papers are flying around, you can be sure housing will feature in the upcoming elections, and the Government itself is finalising its own moves to stimulate the construction sector.
But, perhaps we should look to further comments from John Moran, the secretary general of the Department of Finance, for longer term indications as to how the Government intends solving the Dublin housing problem.
“We need to kind of address fully this idea that everybody needs a three-bedroom house in Dublin, or whether that is the right way to be planning a large city,” Mr Moran told a property development conference last month.
We have heard similar sentiments before, but the prospect that Dublin could more than double in size means they are more likely to be acted on now.
When Mr Noonan decides the time for relaxing has passed, expect plans for a much changed Dublin housing market to emerge.
