The warning from the OECD that the property market here is overvalued by up to 15% should not be seen as a threat to the vast majority of owner occupiers of residential property. This is according to KBC Asset Management's chief economist Eoin Fahy.
He says that those who buy their homes in the typical suburban locations, where the majority of their neighbours are owner-occupiers, are unlikely to experience any significant fall-out from an over-valued property market.
'The relative stability for this type of property is a comfort for both long term owners and first time buyers alike,' the economist says.
Mr Fahy believes that any potential downside will be felt hardest in tax-driven residential developments, or in apartment blocks where investors account for the vast majority of units.
He says these purchases are much more vulnerable to upward moves in interest rates, and a perceived slowing or retreat in values would see many investors deciding to sell. This would lead to a rapid increase in the supply of these properties to the market and a consequent softening of prices, he adds.
