Quarterly Bulletin Q3 2013

24
The Domestic Economy
Quarterly Bulletin 03 / July 13
Chart 4: Consumer Prices
Chart 6: Residential Property Price Indices
% Change Year-on-Year
% Change Year-on-Year
6
30
5
4
20
3
2
1
10
0
-1
0
-2
-3
-10
-4
-5
-20
-6
-7
JMMJ SNJMMJ SNJMMJ SNJMMJ SNJMMJ SNJMM J S N J MM
-30
Q1 Q2 Q3Q4Q1
Q2 Q3Q4Q1
Q2 Q3Q4Q1
Q2 Q3Q4Q1
Q2 Q3Q4Q1
Q2 Q3Q4Q1
Q2 Q3Q4
Q1
2007 2008 2009 2010 2011 2012 2013
2006 2007 2008 2009 2010 2011 2012 ‘13
Ireland: Consumer Price Index
Ireland: Harmonised Index of Consumer Prices (HICP)
EA-17: Monetary Union Index of Consumer Prices (MUICP)
National – All Residential Properties
National Excluding Dublin – All Residential Properties
Dublin – All Residential Properties
Source: CSO.
Source: CSO.
7
Chart 5: Services Sector Inflation
% Change Year-on-Year
between the two measures in 2014 is driven by
technical assumptions for oil prices, which are
subject to a high degree of uncertainty.
6
5
Property Prices
4
3
2
1
0
-1
-2
JMMJ SNJMMJ SNJMMJ SNJMMJ SNJMMJ SNJMM J S N J MM
2007 2008 2009 2010 2011 2012 2013
HICP Services (Overall)
HICP Core Services
Note: Core Market Services equals HICP services excluding
telecommunications, alcohol and administered services.
Source: CSO.
inflation of 0.8 per cent and 1.1 per cent,
respectively projected in 2013 and 2014. The
equivalent forecasts for the Consumer Price
Index (CPI) are 0.9 per cent and 1 per cent
respectively. Excluding energy prices, inflation
is expected to average 0.9 per cent this year
and 1.4 per cent in 2014. The difference
The CSO’s Residential Property Price Index to
May 2013, points to continued divergences
in Ireland’s property market, with signs of
stabilisation and increasing prices in some parts
of Dublin and continuing price declines for the
remainder of the country. Chart 6 illustrates
that the year-on-year rate of change in property
prices for Dublin is in positive territory, up 1.4
per cent in May, while prices for the remainder
of the country continued to decline (although
at a decelerating rate), down 2.8 per cent
compared to the same month last year. There
is evidence of a shortage in the supply of family
homes in parts of Dublin, and properties there
for sale are reportedly selling faster than in the
rest of the country. Some evidence of pent-up
demand is reflected in the rental market, with
rents up almost 5.6 per cent year-on-year in May
according to the CSO’s CPI rental sub-index.
In terms of a cumulative fall from peak, national
property prices have fallen by about 50 per
cent, although considerable differences exist