Irish C.bank says house prices near stable-report
DUBLIN Oct 9 (Reuters) - Irish house prices are getting close to a sustainable level where purchasers will be confident enough to re-enter the market following a property crash, Ireland's central bank governor was quoted as saying on Sunday.
Aided by years of reckless lending, Irish property prices rocketed to unsustainable levels during the go-go period of the "Celtic Tiger" economy, but a spectacular bursting of a property bubble has seen prices tumble for almost four years.
Residential house prices have fallen by an average of 43 percent from their 2007 peak, according to the Central Statistics Office, and Patrick Honohan said they were now edging towards a sustainable level.
"Banks will lend when both they and the borrowers and the purchasers of houses are confident that they're getting the house at a fair, sustainable price and I think we're getting close to that point," the Sunday Independent quoted Honohan as saying, citing comments in a documentary to be aired on Monday.
Under tough bank stress tests in March, the central bank's baseline scenario assumed a 55 percent peak to trough fall in residential property prices between 2007 and 2013, with its adverse scenario pencilling in a drop of 62 percent. (Reporting by Padraic Halpin; Editing by Hans-Juergen Peters)
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