Wednesday 18 October 2017

Average Dublin house is now four times dearer than one in Longford

Properties in Longford are selling for an average of €80,000 - more than four times cheaper than the average price in Dublin. Stock photo
Properties in Longford are selling for an average of €80,000 - more than four times cheaper than the average price in Dublin. Stock photo
Charlie Weston

Charlie Weston

Houses in Longford are selling for less than a quarter of the cost of Dublin properties, a new survey shows.

It comes as evidence has emerged that the mortgage market is bouncing back with a jump in the number of home loans drawn down.

But property prices remain muted in many rural parts of the country.

Properties in Longford are selling for an average of €80,000, a new survey shows.

This is more than four times cheaper than the average price in Dublin of €380,000, according to data compiled for An Post's GeoDirectory.

Low levels of property transactions and a three-tier housing market have been identified in the survey.

Dublin has the highest turnover level and higher prices, followed by the commuter counties and Cork and Galway.

In the third tier are rural counties such as Leitrim, Longford and Roscommon, where there are lower property prices and low levels of transactions.The GeoView report found the national average turnover rate up to June this year was just 2.1pc, representing around 43,000 properties.

This is less than half the turnover level considered normal.

Read more: Property bulletin: Number of homes trading hands falls as prices rise

Meanwhile, figures for the April to June period showed the number of mortgages drawn down rose to 6,800, the banks said. This was up 25pc compared with the previous quarter, with the market now at its highest level since 2010.

First-time buyers still represent the largest number of buyers, accounting for almost half of all drawdowns, the Banking and Payments Federation Ireland data indicates.

The 6,803 mortgages had a value of €1.29bn in the second quarter of this year.

Economist with Goodbody Stockbrokers Dermot O'Leary said the figures suggested that the market was recovering from the shock of the introduction of Central Bank mortgage lending caps.

"The latest mortgage data suggests the hangover following the introduction of the macro-prudential rules is wearing off, with good momentum going into the second half of 2016."

The average amount drawn down by both first-time and mover-purchasers has risen by around €30,000 in the past three years.

First-time buyers are now borrowing an average of €183,000. Just over €230,000 is being borrowed by the average mover, the figures show.

The level of mortgage switching remains low, with just under 500 loans remortgaged in the April to June period. However, the trend indicates that mortgage switching is becoming more popular, with a 75pc rise in the numbers remortgaging in the year to June.

And in an indicator of future mortgage market activity, the numbers being approved for a mortgage were up, the banks said.

The numbers approved for a mortgage rose in June to 3,140, a rise of 22pc compared with the same month last year, the banking figures show.

First-time buyers account for almost half of the approvals.

Analyst at Davy Stockbrokers David McNamara said he expected the market to surge this year, with lending of €5bn to new buyers and to investors.

Mr McNamara said the figures showed that the mortgage market was in good shape.

"The recovery in jobs and wages of late has allowed borrowers to obtain larger loans, bidding up house prices in a still supply-constrained housing market," the economist said.

Irish Independent

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