Monday 25 September 2017

How 30pc of houses for sale can’t find buyers despite crisis

Despite crisis, large number of homes remain unsold

One-in-three houses put on the market almost three months ago has failed to sell. Photo: PA
One-in-three houses put on the market almost three months ago has failed to sell. Photo: PA
Paul Melia

Paul Melia

One-in-three houses put on the market almost three months ago has failed to sell.

A snapshot of almost 200 properties across 15 counties ranging from two-bed apartments to €1m-plus homes shows that 30pc, or 58, remain on the market despite the housing shortage.

Experts said that in many cases, houses were overpriced leading them to be slower to trade hands. However, some expressed surprise at the lack of movement, given the housing crisis.

Details of 193 houses and apartments for sale on Daft.ie were recorded on March 9 and March 13 last.

They include two-bed apartments, three and four-bed houses and luxury homes costing at least €1m.

As of June 1, 135 were sold or withdrawn from the market and 58 remained unsold.

Advising caution: IPAV chief executive Pat Davitt
Advising caution: IPAV chief executive Pat Davitt

One property source expressed surprise at the number of unsold homes, suggesting that given the low levels of stock people were snapping up units, even those in poor condition in need of substantial work.

"We're reading every day that there's not a lot of stock, and I'm surprised to hear that," one said.

"A lot of people would be happy to take on a refurbishment job because it might be a cheaper option, and there may not be much competition. The mid-level stuff like a regular three-bed semi-D is the most sought-after thing."

But the figures show that even in areas of high demand, not all homes are selling.

Of 56 properties recorded in Dublin, 15 remain on the market - 26pc. In Cork, four of 13 are on the market, or 30pc. In Galway City, 11 homes were noted and four are unsold, or 36pc.

While three-bed homes are in demand, particularly for families getting onto the property ladders, some are not shifting. Details of 16 three-bed semi-detached homes in Dublin were recorded, and three remain on the market.

However, they are relatively expensive, with the cheapest in Marino priced at €425,000 and the most expensive in Rathgar costing €600,000.

The figures also show:

  • Of 59 two-bed apartments, 14 remain unsold, or 23.7pc. Four of 16 in Dublin are unsold. One unit in Kilkenny remains unsold.
  • Of 62 three-bed houses, 14 - or 22.6pc - are still on the market. Three out of 16 in Dublin, one from four in Cork and one from four in Galway City are unsold, despite high demand in these areas.
  • Of the 62 four-bed homes offered for sale, 24 - or 38pc - remain unsold.

In some cases, auctioneers have dropped the price due to lack of demand, with some properties also withdrawn from sale.

However, regional director of estate agents RE/MAX John Fogarty said that in many cases properties remained unsold because they were overpriced.

He said that in rural areas, most properties would not remain on the market for more than six weeks. In Dublin, it could take just 10 days to sell a home.

He said agents should be aware of what similar homes were selling for by examining the Property Price Register, which records the selling price of all homes, and through market knowledge.

"At the high end, what can happen is an owner may have an expectation that is not in agreement with what the agent says. In my opinion, those properties should not go on the market," he said.

"You might get a trophy home which was €3m at the height of the boom.

"Some properties of these type don't sell because the vendor wants a certain price.

"With three and four-beds, the agent will look at what similar properties went for in the months previously, and the property price register.

"You would also ring around the agents and they may have an offer in excess of the asking price.

"Because there's a shortage of properties, some firms are going in €20,000 dearer and the consumer runs with that. If customers interview three agents and one has a silly figure, they need to be aware of that."

Chief executive of the Institute of Professional Auctioneers and Valuers Pat Davitt said there was "no doubt" that some homes were over-priced, but added that the market was not as strong as portrayed in some areas.

"The market is being blown up to be a lot stronger than it is in a lot of places. There's different areas of Dublin selling very well.

"But in other (parts of the city) people won't pay the asking price, they are more discerning. If the first-time buyers grant encourages more to build properties, the price of housing will come down."

Irish Independent

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