Residential property prices rising at fastest pace in two years

It compares with a 7.1 per cent increase in the year to July 2016, and an increase of 11.5 per cent in the year to June 2017.

However, residential property prices remain 28.1 per cent lower than their highest level in 2007. According to the CSO, Dublin prices are 28.4 per cent lower than their February 2007 peak, while prices in the rest of Ireland are 34.3 per cent lower than their May 2007 peak.

Mortgage lender KBC Ireland has attributed the strong price trend to the intensity of demand and inadequacy of housing supply.

It added: “However, the increase in activity has slowed markedly of late even as the pace of increase in prices has picked up, highlighting an increasing shortfall in supply relative to notably strengthening demand.”

KBC said that the trend in transactions outside the capital was more modest, noting: “This has translated into a steadier if still strong pace of property price inflation outside Dublin.”