Thursday 19 September 2019

Cork City Centre: Traffic congestion drives up demand

Average price: €175,000
Up: + 7%
One Year Forecast: + 7%
Assessing Agent: Savills

The average price for the city area is low given the larger stock of smaller homes, in particular apartments and smaller terraces.

The property market in Cork City first revived in the middle of 2013 with investors sensing the bottom and plunging in to buy entire blocks of apartments in the city centre area.

Traffic congestion is driving up demand in Cork city centre.
Traffic congestion is driving up demand in Cork city centre.

The effect was immediately inflationary as competing recession-postponed buyers with cash jumped off the fence and fought it out for the best prices in a generation in the southern capital's centre.

Despite falling values in the first half of that year, the feeding frenzy catch up was enough to lift the market by 5pc in the 12 months overall to the beginning of last year.

Cork City Centre
House Types201420152016
3-bed Semi, €205,000 €210,000 €225,000
4-bed semi, €220,000 €230,000 €246,000
1-bed apartment, €110,000 €125,000 €134,000
2-bed apartment, €160,000 €175,000 €182,000
2-bed terrace, €170,000 €187,000 €192,000
3-bed terrace, €185,000 €190,000 €203,000
Ex-corporation 2-bed, €150,000 €160,000 €171,000
Ex-corporation 3-bed, €165,000 €175,000 €187,000
3/5 storey over basement, €420,000 €450,000 €480,000

The steady recovery in Cork city centre's market continued through 2014 and the 5pc increase expected for the year was exceeded as the banks started lending again, even for apartments. The latter are costing 10pc more with parking spaces attached than without.

Rents are now up 5pc on 12 months ago.

Recently, there have been twice as many bidders for properties compared with a year previous and it has been common to find seven or eight people making offers on one property says our expert, Michael O'Donovan of Savills Cork.

"As well as more loans available from the banks, we saw a lot of parents in the background helping younger buyers financially," he says.

"For the first time since the recession we have seen investors losing out to first-time buyers, especially in pursuit of smaller city centre homes," says O'Donovan, who adds that increasing issues with traffic congestion are encouraging younger couples to seek family abodes in the city centre area.

The wealthiest among these buyers are now seeking to restore larger period properties and turn them back from city office use into private residences.

COLLEGE ROAD IN GLASHEEN: In a rising market, College Road is central, brimming with mature and spacious homes and on the doorsteps of UCC and the Bon Secours Hospital. A no brainer.
COLLEGE ROAD IN GLASHEEN: In a rising market, College Road is central, brimming with mature and spacious homes and on the doorsteps of UCC and the Bon Secours Hospital. A no brainer.

"Traffic is an increasing factor for those in the suburbs and Cork City could really do with a public transport system like the Luas with park and ride facilities," says O'Donovan, who expects prices to grow in the city centre area at a similar rate this year as they did in 2014.

As long as the traffic continues to jam, he says there is likely to be a continued demand for conversions in the old city area.

As a result of the end of capital gains tax incentives and reduced interest from investors overall, apartments are expected to grow by just 3% this year, while three-bed terraces, more suited to small families, are expected to move above the €200,000 mark for the first time in many years in the city centre.

Meanwhile, while big period houses in the three- to five-storey over-basement size were subject to some conversion, many of those, especially those which have been in flatland use, are just too large and require too much investment for the private owner occupier.It means that per square foot, they remainthe cheapest property to buy in the Leeside centre and their condition is likely to remain an issue.

Independent.ie Guide to House Prices in Ireland

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Irish Independent

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