Irish house prices are expected to continue to fall in price for at least the next 18 months.
Trinity College Dublin professor Brian Lucey made the prediction as Irish property website www.daft.ie released figures indicating that the property crash is slowing but far from over.
The daft.ie figures show that asking prices fell by 3.4 percent from January to March in 2010. However, this quarterly drop represents the smallest fall in house prices in over two years.
Daft.ie now estimates that the average house price in Ireland is now $313,000, and has fallen by one third since it's peak in May 2007.
Professor Lucey is expecting the average house price to drop to a staggering 50 percent. Lucey basis his prediction on the assumption that the crash will last for another 18 months.
Lucey points out that the biggest drop in prices has come from Dublin city and surrounding commuter areas.
The average price of a house in Dublin has fallen by 44.2 percent to $320,000.
“Buyers are clearly factoring in further deflation,” said Lucey.
The length of time a house stays on the market has increased from four to five months in Dublin and in Ulster and Connacht a house may stay on the market for 15 months.
However the housing stock in Dublin has dropped by 20 percent and has dropped overall around the country by only 5 percent.
Lucey said the Government was foolish not to publish a current house price index or even a monthly index to curb deflation.
“We are, as a nation, steering blind, not to mention dumb, on the seas of house price deflation,” said Lucey.
Lucey added that widespread negative equity would impact on Ireland's ability "to labor mobility, to discretionary expenditure, and ultimately to economic growth.”
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