| 7.4°C Dublin

Full extent of families' struggles to buy a home is revealed

Close

 (Stock photo)

(Stock photo)

Reuters

(Stock photo)

New home prices have almost doubled in seven years in Dublin - while ordinary household buyers have seen their percentage share of purchases eroded by funds.

The proportion of household purchasers in the capital reduced from 95pc of all transactions in 2010 to 72pc last year as so-called vulture funds and cuckoo funds have swooped in.

In the second-hand market alone, non-household purchasers now account for almost one in five acquisitions.

A report published by KBC Bank shows the extent that funds have affected the property market here in recent years, particularly in the capital.

Its data shows the proportion of 'non-household' buyers has increased five-fold in the last decade.

The proportion of existing homes, excluding new homes, bought by non-households rose from just over 2pc of purchases in 2010 to 19pc last year.

While 'non-households' also includes local authorities and housing charities, it is understood that funds make up by far the largest chunk in this category.

Affordability

KBC's data also shows the first decline in first-time buyer purchases of new builds since 2015.

In 2019, new builds represented a fifth of all purchases in the capital, with 52pc bought by first-time buyers.

The share of first-time buyers as a proportion of household buyers overall is down from 60pc in 2010 to 37pc.

The drop in purchases of Dublin new homes by first- time buyers likely reflects the drop in affordability that has been seen over this period.

There were cumulative price increases in new homes of 90pc in the seven years from 2012 to 2019. This means that prices almost doubled during that time.

However, according to economist Shawn Britton, who compiled the report, the data also reinforces suggestions from other sources that property price inflation is easing somewhat.

There were notable price declines in Dublin City and Dún Laoghaire-Rathdown council areas, followed by notable slow-downs in price growth in South Dublin and Fingal, where homes are more affordable.

The softening in prices is occurring as affordability ceilings are reached.

Irish Independent