People think the houses will rise but have they the money to buy them?

 A new index from AIB/ESRI is a measure of consumer perceptions in relation to the Irish housing market as well as their house price expectations.

The survey of over 800 consumers was conducted by the ESRI between July and December 2013.

A significant shift in consumer expectations in relation to house prices from July to December 2013. Those consumers surveyed who believe house prices will be higher in 12 months’ time increased from 29.2% to 46.3%

The main reasons for not buying noted by consumers surveyed included that they are ‘satisfied with their present dwelling’ (54.6%), followed by ‘cannot afford it’ (22%)The main risks to buying noted in December by consumers was ‘worries about future income’ or ‘affordability concerns’ (58.4%), followed by ‘fears about increasing interest rates’ (17.7%). Also cited were ‘changes in family circumstances’ (16.3%), as was ‘possible changes in house prices’ (6.5%)

Overall, consumers expect that house prices will increase by 2.1% over the next 12 months. Dublin-based consumers expect higher house price growth, with growth of 3.6% expected over the next 12 months.