Figures from the latest AIB Irish Housing Market Bulletin point to a continued downturn in construction and suggest negative sentiment towards the housing market.
The latest data show house guarantee registrations were down 35 per cent year-on-year in the first seven months of the year, while the number of building commencement notices fell by 22.5 per cent in the first half.
The slowing in construction has yet to be reflected in completion figures from the Central Statistics Office (CSO), which remain unchanged since the second half of last year, according to the report.
The AIB report suggests that the significant decline in the number of commencements and registrations anticipate a parallel decline in completions in the future, although the statistics will not reflect this situation immediately.
The AIB estimates that the number of completions will fall to 80,000 this year - a 6 per cent decline on CSO figures for 2006. The bank said that if current trends persist, the number of house completions next year will fall significantly below the current predicted level of 70,000 and may be closer to 62,500 in 2008.
The AIB said that while some industry commentators are retaining a favourable view of potential improvements in the housing market here, the bank takes the opinion that sentiment towards the housing market will continue to be depressed through the autumn and that developers will slow the rate of construction even further.
The bank said that there was nothing to suggest that current sentiment towards the housing market is improving despite some reports of a pick-up in interest among potential buyers during the summer.
According to the Permanent TSB house prices nationally fell in June, for the fourth consecutive month, by 0.5 per cent.