House prices in Dublin were on average 55 per cent higher than outside the capital in the third quarter of 2005, a bulletin on the housing market has found.

According to the report by Bank of Ireland Global Markets, the average price of a house in Dublin now stands at €430,000, compared to a price of €278,000 outside the capital.

At €309,000, the average residential property price in Cork was 40 per cent cheaper than in Dublin. The average price in Galway was €323,000, while Limerick and Waterford properties averaged €237,000 and €256,000 respectively.

Annual historical data show that in 1976, the average euro price of a house in Dublin - €15,900 - was just €900 higher than outside the capital.

The differential widened to 40 per cent by 1996, peaked at 63 per cent in 1998 before falling back slightly, according to the survey.

"A strong price differential in favour of the capital city is not uncommon, as employment and incomes are normally higher there relative to the rest of the country," Bank of Ireland chief economist Dr Dan McLaughlin said yesterday.

"However, income in Dublin tends to be of the order of 15 per cent above income elsewhere in the country, which implies that people living in the capital will have a higher debt repayment burden than the national norm."

Dr McLaughlin said an increased concentration of higher-paid jobs in Dublin, as well as a slower rise in housing supply added to price pressure.