Despite a buoyant economy, surging house prices exclude many potential buyers from the property market.
With house prices rising at a ridiculous rate, for many people the dream of buying a home is far from a reality.
It's not much use having a buoyant economy if people still can't afford the one thing that most of us are working towards.
Disheartened home seeker Redmond O'Hanlon is paying £200 per month in rent. He would like to buy a house, but as a young, single person he is finding it hard due to the high prices.
A brand new house in Lucan is £83,000. The most he can raise through a mortgage is £55,000. Redmond O'Hanlon does not see the situation improving for first time buyers as property prices look set to rise over the next year.
Chief Executive of the Consumers Association of Ireland Caroline Gill predicts house price increases could be more than 12%. People who purchased homes in 1991 or 1992 got very good value but if they wish to trade up they will still need to borrow a large amount.
To solve the problem Caroline Gill thinks more land needs to be freed up and more planning permission granted. In addition, first time buyers should be give a larger grant to allow them get into the market.
Michael Goggins of the Construction Industry Federation agrees. In his opinion, the high housing prices are due to a scarcity of suitably zoned and serviced land. This is particularly true in Dublin where,
The relevant authorities were slow to realise that the system wasn't geared for the level of economic activity that has been taking place.
According to Michael Goggins, this has affected the supply of land coming onto the market. Supply could be freed up if the process that was meant to work was working properly.
Offering some hope to those trying to get onto the property ladder is estate agent at Sherry FitzGerald Simon Ensor. He points out that there are still properties in some parts of Dublin giving reasonable value for their location.
His advice to buyers in Dublin is to find a home in an up and coming area. Two affordable areas he suggests are Ringsend and off the Infirmary Road near the Phoenix Park.
This episode of 'Streetwise’ was broadcast on 27 January 1998. The presenter is Fiona McCarthy.
