The Economic and Social Research Institute has found that if housing output was increased by 10,000 units a year, house prices could fall by 12%.

In a new report, the Institute also maintains that increasing output would not necessarily lead to significant wage inflation in the construction sector.

The ESRI has assembled a range of data on the construction sector and incorporated into the model it uses to forecast what happens in the Irish economy.

It takes the construction of 25,000 units a year as a base case scenario and asks what might happen if that output were increased by 10,000 units a year for the rest of this decade.

That 35,000 units a year is just one estimate of where housing supply needs to get to cope with the demands of our rising population.

The ESRI finds that it would bring prices down by 12% by 2030 but wages in the sector might only rise directly as a result by just 1%.

The report delves deeper into the factors that seem to be holding construction back.

It suggests that construction trades should be placed on the Critical Skills Employment Permit programme to attract workers from abroad as Ireland could need 60,000 construction workers by 2025.

It also says there are 'question marks' over whether the financial system in Ireland can provide the credit necessary to meet the demand for residential property.

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It also cautions that inflation in construction materials is likely to continue, even if at a slower pace, because there is so much demand in the housing market here.

Meanwhille, Construct Innovate, a new Enterprise Ireland Technology Centre hosted at University of Galway, was launched today.

The centre has been established with funding of €5m, over five years, to accelerate research and innovation in the construction sector and put the built environment industry at the cutting-edge of developments by utilising the strengths of a network of government, industry and academia.

Dr Magdalena Hajdukiewicz, one of the directors of Construct Innovate, said the vision for Construct Innovate is to provide a platform for collaboration to all stakeholders in the construction industry.

She said the new platform will empower industry to take ownership of research and innovation and supports a modernised, resilient and sustainable sector.

"A key part of our work will be listening to industry – as they identify challenges and we will work together on this innovation journey," she added.