Home-buyers not planning to take plunge for two years
ATTEMPTS by the Government to kickstart the property market this year look like being frustrated after a survey found that most potential buyers are likely to wait at least two years before purchasing.
And a majority of people expect house prices to continue falling as they do not believe they represent good value.
The Government has boosted the amount of tax relief that first-time buyers can get this year in an attempt to get the property market moving.
A first-time buyer couple who buys this year can get up to €5,000 a year in mortgage tax relief.
However, the property must be purchased before the end of December to avail of the tax relief as it will not continue into 2013.
A survey by property website Daft.ie of 2,000-plus people found that almost four out of 10 intended to buy this year. But a majority will wait for two years or more, and others intend to stay renting.
Most of those surveyed by Daft.ie were renting, with owner-occupiers making up the next largest chunk.
The consumer attitudes survey found that the availability of mortgage credit was considered the most important factor affecting house prices this year.
Other issues set to affect the housing market include unemployment and economic growth.
The survey found that 62pc of people were in no hurry to buy. This was made up of those who would wait at least two years (46pc) before purchasing, would continue to rent (3.8pc) or else were happy in their current property (12.3pc).
And 65pc believe that property prices will keep falling.
Daft.ie economist Ronan Lyons said the survey showed that most people were in no rush to buy.
"People are holding out because they feel prices are going to fall further. But that can become a self-fulfilling prophecy -- if everyone thinks prices will continue to fall, they will."
The Oxford-based economist said the reluctance of people either to buy their first home or trade up or down was despite rising rents in cities.
And a shortage of three-bedroom family homes meant there was now a shortage of rentals in Dublin and Cork, he said.
A recent survey found that the property collapse had sent house prices back to levels once again affordable for those on the average salary.
The Demographia survey found that the plunge in the property market over the past four years meant that prices had crashed to the extent they were now more affordable than in all other English-speaking countries except the US.
The Government is to introduce a house price register by the summer, which will give up-to-date information on house price sales.
Official figures show that property prices have halved since the peak, but the figures exclude cash purchases and are seen as out of date as soon as they are published.
Meanwhile, the Construction Industry Federation put a positive spin on the survey, saying 60pc intended to buy property in two years' time or even sooner.