DUBLIN city has less than 1pc of its housing stock currently for sale – the lowest proportion in memory for estate agents.
Numbers of properties available in the capital are now reduced to less than 5,000, according to the latest report from a leading estate agency network.
Sherry FitzGerald's property market report for Q3 says the percentage of property for sale in Dublin is now down to 0.9pc of the entire stock.
International norms suggest that a 6pc supply is necessary for equilibrium and a normally functioning market.
"In the absence of a supply of new homes for an expanding population, more uptake than normal is happening in the secondhand market," said Sherry FitzGerald economist Marian Finnegan.
"There are few new homes coming to market and these normally account for one-third of demand."
There are 46,203 units for sale nationally but of these, just 4,502 are on the market in Dublin – or less than one-tenth of the total property for sale.
This is despite the fact that Dublin makes up just over one-third of the national population overall.
Shortage of supply causes the sort of increases currently being experienced in the capital, where property prices are rising at a rate of more than 1pc per month.
This is the equivalent of €3,000 per month for a house currently priced at €300,000.
The reasons behind the supply squeeze include a perfect storm of factors:
* No new homes are coming to market – they usually satisfy one-third of demand.
* Tracker holders are reluctant to sell and give up their mortgage deals which allow them savings as high as €1,000 per month.
* Those thinking about selling are now holding off, as prices rise and they hope to achieve a better price
Not surprisingly, supply is lowest in the Dublin City Council area, where it is now down to 0.8pc.
This includes locations like Ranelagh, Sandymount, Clontarf, Ballsbridge and Rathgar, where agents report that competition for low stocks of property has been hottest.
Further out in south Dublin and Dun Laoghaire-Rathdown, supply is at 0.9pc, while Fingal is at 1.3pc.
But other cities are now feeling their own supply squeeze.
Ms Finnegan added: "It is worth noting that only 1.9pc of the private stock in Cork city and 1.6pc of the private stock in Galway city are available for sale.
"Such figures suggest that both of these locations are also beginning to see a supply pinch point which could further impact price performance in the short term."
Other counties or cities showing a concerning level of under-supply of property are the commuter counties of Meath (1.9pc) and Kildare (1.6pc), Galway city (1.6pc), Cork city (1.6pc) and Kilkenny (2pc).
Those counties with the highest supply include Kerry (4.3pc), Cavan (6.3pc) and Roscommon (5.4pc).