Another year of dysfunction ahead for Ireland’s property market
Looming general election and UK-EU trade talks add to uncertainty for developers.
With the new year now a week old and a raft of predictions and data on house prices, what can we expect in the residential market this year?
For those looking to get on the property ladder, there are some positive signals.
Property website Daft recorded house prices falling last year for the first time since 2012. The Daft report showed that the cost of the average housing unit at the end of December was €250,766, down 1.2 per cent on the start of the year.
There was a similar theme in a report by property website MyHome.ie, which is owned by The Irish Times.
Its report for the fourth quarter of 2019, compiled with stockbroker Davy, showed that the average selling price for a house in the Republic rose 0.72 per cent to €267,000 over the same period of a year earlier. That figure was down 0.45 per cent on the previous three-month period.
Good if you’re buying, bad if you’re trying to sell. Brexit uncertainty was partly to blame, while the Central Bank’s mortgage rules have kept a lid on lending.
“It’s clear that we’re not building enough apartments, which is the only way we’ll ever catch up with demand in Dublin”
The financial regulator recently estimated that house prices would have risen by another 26 per cent were it not for its macroprudential rules, which require first-time buyers to have a 10 per cent deposit and limit how much they can borrow to 3½ times their income.
Without doubt, the residential property market has slowed. A total of 54,963 sales were recorded on the official Residential Property Price Register last year – 2,239 fewer than in 2018. This is not good for either buyers or sellers.
On a positive note, new housing output is rising. In 2018, some 17,995 new dwellings were completed with various forecasts for last year putting the figure at 21,000-plus (we won’t have the final number for a while yet).
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