Assessing Housing Market Overvaluation

This chapter analyzes a model for evaluating housing market valuations using factors like disposable income, interest rates, and demographic changes. It suggests that current house prices may be 8% to 10% overvalued, reflecting vulnerabilities such as household debt and potential economic shocks. The discussion emphasizes the importance of addressing ongoing housing shortages in Ireland and questions the efficacy of models that predict market equilibrium amid rising prices.