So what is your house worth now?
The housing market could finally bottom out at 70 per cent below peak, finds Roisin Burke
There's talk of an ECB interest rate U-turn and cut, but Bank of Ireland and AIB are on solo runs to hike rates, heaping more misery on mortgage payers.
That's not going to help an already static housing market, down some 50 per cent from peak, and with potential to tumble by 70 per cent.
It's time to look for the floor in relation to house prices.
But with almost nothing selling, how do you call it? The fire-sale phenomenon is one way, Daft.ie economist Ronan Lyons suggests.
A recent one in Donegal was a damp squib but Allsop's sale in the Shelbourne in Dublin was thronged with buyers and another is planned for September. With almost nothing being sold in the regular way, the knockdown price auctions "give a price point to buyers", said Mr Lyons, who has researched and graphed their results.
"Fire sales show Dublin prices at 65 per cent below peak and prices elsewhere in the country at 70 per cent below peak," Mr Lyons added.
Official data on asking prices and CSO statistics suggest the Dublin housing market has dropped 50 per cent from peak and 40 per cent ballpark in the rest of the country. If the Allsop's auction next month attracts buyers, it will be interesting to see if the sale prices reflect more market softness than that.
"While the stats from Daft, the CSO and the ESRI appear to show prices for Dublin falling more than elsewhere, the Dublin market is adjusting faster and looks like it's actually probably closer to stabilising," said Mr Lyons.
Not so in other areas perhaps. Prices in the upper Shannon region (Leitrim, Roscommon, Cavan), places where councils were more trigger-happy with planning permission and tax-break uptake was high, and "where there was overconstruction and there is oversupply and fewer centres for jobs, it probably won't improve much within the next five years", he predicts.
However, recovery could start over 2012-2013 in Dublin, within six to 12 months, he suggests. "Cork will follow quite soon after Dublin, in the second half of 2012, and cities like Galway, Waterford and Limerick within 12 months of Dublin.
"Recovery does not mean prices going back up to where they were. What we need to see is prices moving in line with inflation, a little above that, growing by about two to three per cent a year," he said.
Sunday Indo Business