Thursday 25 December 2014

Dublin house prices set to rise faster than New York

Published 04/05/2014 | 02:30

Activity in the commercial sector has rocketed in the last year, as investors pile into office blocks in particular.
Activity in the commercial sector has rocketed in the last year, as investors pile into office blocks in particular.
Table comparing house prices in rising cities

DUBLIN has been named as one of the "rising stars" of the global property market, and the super-rich are being strongly encouraged to park their cash here.

According to a newly released report from Savills, Deutsche Asset & Wealth Management and Candy & Candy, the famous property developer that caters almost entirely to the super-prime end of the market, Dublin is now one city that has becoming hugely attractive as an investment opportunity.

The Candy GPS Report reveals "the top tips for global city performance" according to Savills World Research.

It notes that Dublin could out-perform the real estate markets in prime world cities such as New York, London and Paris in the next few years as increasing numbers of global investors seek alternative locations.

The report emphasises the positive international image of a country that "took its medicine" in the form of austerity cuts after the financial crash. It also claims that we can now finally reap the benefits of that strategy.

"Having seen some of the worst effects of the Eurozone crisis after 2008, Dublin saw some very severe price corrections in its real estate markets," the research notes.

"Having taken its economic medicine deep and early, cities like Dublin are now poised for recovery and benefiting from improving economic conditions."

It adds: "Property is still discounted and it could be said to offer good value in the context of strengthening industry and in growing employment."

Like other "rising" cities, including Tel Aviv in Israel, Dublin's growing technology industry, and the high-earning professionals that sector is producing, is seen as a big plus for potential investors.

Most of that growth has occurred around Grand Canal Dock, where the likes of Google and Facebook and other software and technology companies have established a substantial presence.

A two-bed prime apartment can be had for a little over €400,000 currently, but at very attractive yields.

Alongside Dublin, Candy and Savills tip Melbourne, Miami, Chicago, Beirut, and Istanbul among other cities destined to do well in the property market.

Savills director of global research Yolande Barnes claimed that growth in these "secondary cities" was likely given that the recovery in residential markets since 2008 had been focused mostly on the "top tier cities in prime markets".

"With many world city prime markets now looking fully valued, the question is, which cities will show growth next?" she said.

"Investors have already been spreading their wings away from the established safe havens and looking at alternatives, both in secondary markets and second-tier cities."

"We have identified 12 cities around the globe that don't have world city status but which we see as rising second-tier cities with the potential to show strong residential property price growth as global investors seek alternative locations," the Savills spokeswoman added.

"This more adventurous approach is likely not only to provide higher-income returns, but also the opportunity for significant capital growth. And real estate values will grow as new cities all over the globe rise.

Candy & Candy CEO Nick Candy additionally claimed that property was now a "unique asset class" for the ultra-wealthy.

"Investment to date has focused on prime property in the top-tier world cities, which have shown record market growth," he said.

"Real estate will continue to play an important part in global investment, with many investors now looking beyond established safe havens and prime world cities," the Candy & Candy CEO added.

Sunday Indo Business

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