DAVY VIEW

After rebounding strongly into the summer months from a soft start to the year, residential property prices accelerated in July with a faster monthly pace of growth compared to June. Last month, we reverted to our prior forecast that prices would grow 5.5% this year on average, and today’s data further underscore the likelihood of such an increase. Despite higher inflation and interest rates, we think price increases will moderate only gradually over coming years, supported by very strong demand and an ongoing long-running shortfall of homes in the country.