House price rise in capital bucks overall trend as slump continues
Published 26/04/2013 | 05:00
THE gap between Dublin property prices and the rest of the country has widened.
Prices fell countrywide in the past year, but rose in Dublin.
Experts said this was further evidence of a two-speed property market.
The nationwide fall in prices and a drop in the number of transactions have been blamed on buyers rushing to sign up for mortgage interest relief before it was withdrawn at the end of last year. This has meant fewer transactions this year.
Prices fell by 3pc in the past year across the State, following a drop of 0.5pc in March, according to the Central Statistics Office.
However, housing experts said this pointed to an easing in the pace of property value falls because the fall of 3pc compares with a drop of 16.3pc recorded in the 12 months to March 2012. In Dublin, prices were 1.4pc higher compared with a year ago, despite a fall in March.
Calculations based on the CSO figures show that the price of a property nationally is now €155,000, down from €314,000 at the peak of the housing boom in 2007.
Dublin prices now average €188,000, down from a peak of €430,000. Outside the capital, the average property is now selling for €138,000, down from a high of €268,000.
Prices have now halved countrywide since the peak.
Dublin prices are down 56pc, with those in the rest of the country down by 49pc.
Although the pace of price falls has eased, the latest figures mean recovery in prices is still some way off.
Goodbody Stockbrokers economist Dermot O'Leary said it was the fourth consecutive monthly decrease in prices. But he said Dublin prices continue to outperform the rest of the country. This was despite a 7.2pc fall in apartment prices in March.
Mr O'Leary said much of the slowdown in the property market was due to the ending of mortgage tax relief last year.
"Despite the slowdown in the property market associated with the ending of the mortgage interest relief at the end of 2012, housing indicators still appear to point to stabilisation. The fledgling recovery in the Dublin market remains in train."
But plans by banks to repossess properties, particularly buy-to-lets, in the second half of this year mean prices could keep falling.
KBC Bank's Austin Hughes said it was hard to call where prices would go next.
"The odds point to another drop in 2013, but our gut feeling is that the decline will be in low single digits."