Irish households are now officially wealthier than they were during the boom thanks to the rapid recovery in house prices.

According to the Central Bank, the net worth of Irish households rose to a record €727 billion at the end of last year, eclipsing the previous peak of €720 billion reached in the second quarter of 2007.

Household net worth, calculated as the sum of housing and financial assets minus their liabilities, is now the equivalent of €151,657 per person.

The figures show it increased by almost €15 billion in the final quarter of 2017, with half of the increase coming from rising property values.

Net wealth fell to a post-crash low of €430 billion in second quarter of 2012 as unemployment and mortgage arrears soared in the aftermath of the financial crisis.

However, it has increased by 69 per cent in just over five years. Two-thirds of that improvement is due to the rise in property values over the period, the Central Bank said.

Most indebted

On the liabilities side, the figures reveal that while debt levels have fallen, Irish households remain among the most indebted in the European Union.

Overall household debt fell to €151 billion in the fourth quarter of 2017. Since the peak, nominal household debt has fallen by €61 billion or 29 per cent and is back at levels last seen in late 2005.

When compared with disposable income, household debt in Ireland now stands at 137 per cent, which is the lowest since 2004. Nonetheles, this is still the fourth highest in the EU. The euro area average stands at 94 per cent.

While the aggregate data highlights the rebound in the Irish household position, the distribution of household assets and liabilities is vitally important, the Central Bank noted.

The figures show Irish households in the 35-44 age cohort remain highly indebted, whereas younger generations have lower debt levels relative to the rest of the euro area.

“This is where there will be significant credit demand over the coming years,” the Central Bank said.

“The older cohorts, where home-ownership rates are highest, have been the biggest beneficiaries of the boom in house prices over recent years,” it said.