Fewer homes changing hands as prices continue to soar
The number of homes changing hands has plummeted by as much as 17pc in areas with acute housing shortages due to the lack of new supply coming on to the market.
An analysis of the Property Price Register shows sharp drops in transactions for homes across Cork, Dublin and Galway, where demand is highest - and where prices continue to rise across the rental and home ownership markets.
It reveals that just 1,153 new homes traded hands across all counties in the first three months of this year, compared with 1,009 12 months ago. This is despite 25,000 new units being needed every year just to keep pace with demand.
It also shows that the number of sales completed in the first three months of this year fell year-on-year. In the first quarter of 2016, some 9,377 deals were concluded. This fell to 8,061 in 2017, a drop of 14pc or some 1,316.
Reports from property websites Daft.ie and myhome.ie suggest that prices will continue to rise throughout 2017 as the shortage of homes drives prices upwards.
The Property Price Register shows the average price paid per transaction now stands at €255,069 nationally. This compares with €238,534 a year ago - an increase of more than €16,500 or almost 7pc.
The data also suggests that across many areas of high demand, the sale of new-builds is falling - they are down from 151 to 121 in Cork, and from 37 to 27 in Galway. Conversely, in Dublin, some 325 transactions were completed in 2016, which increased to 513 in the same period of 2017.
Property experts suggest that prices continue to rise due to the lack of supply, changes to mortgage lending rules, and the introduction of the Help-to-Buy scheme in January this year.
It is designed to help first-time buyers secure the deposit required to purchase or self-build a new house or apartment, and allows for a refund of income tax and Dirt paid over the previous four tax years, limited to a maximum of 5pc of the purchase value. The relief is capped at €20,000.
Data from the Revenue Commissioners shows the average payment made to date is just over €15,300, and the bulk of successful applicants are seeking help buying a home in Dublin, the Dublin commuter belt, and Cork.
There have been calls for it to be scrapped amid concerns it is fuelling price hikes. But Housing Minister Simon Coveney has rejected the claims, saying it is helping to stimulate demand and allow first-time buyers into the market.
The Property Price Register also shows that the amount being spent buying property has dropped by €180m year-on-year - deals totalling €2.23bn were completed in the first three months of 2016, which fell to just over €2bn this year.
In Cork, the number of transactions fell by more than 17pc to 899 in the first quarter of this year, compared with the corresponding three months of 2016.
In Dublin, they dropped 14pc to 2,660 - a fall of 443 - and by almost 10pc in Galway to 392.
The register also suggests that the number of transactions across the Dublin commuter belt counties of Kildare and Wicklow has remained largely flat, but there has been a 9.5pc increase in Meath, up 26 to 301.