The KBC Bank consumer sentiment index shows that young people believe their incomes will improve. It also indicates that most people expect house prices to continue rise over the next five years. Only one in 10 sees them falling.
KBC economist Austin Hughes ponders whether this fear of ever more expensive housing could be adding to demand at present?
Consumers in Munster are more convinced of this than those in other provinces, and expectations of price increases are stronger among men than women. Slightly fewer of those in the 25 to 44 age group expect price appreciation. More people in the 55 to 64 age group feel prices will rise, according to the index.
Hughes said these results indicate the belief among large numbers of people that the shortfall in supply will persist.
The Central Statistics Office’s latest figures show that property prices rose by 14pc in the year to last November. They are now close to those seen during the Celtic Tiger property bubble.
There has been a huge ramping up in construction, with some predicting 30,000 housing units will be built this year. But most homes completed next year will not be available to first-time buyers and will instead go toward social housing and the private rental market, according to a Goodbody report.
KBC’s survey also found that most consumers are positive about the future economy up until 2027. Consumers outside Dublin, women and those facing financial difficulties are more cautious than others.
Younger consumers remain optimistic, but the majority of over-55s expect their incomes will be lower in five years’ time.
LSL News.