Sunday 15 September 2019

Galway City: Buyers biting back in bidding war with big city investors

Average price: €200,000
Up: + 9%
One Year Forecast: + 8%
Assessing Agent: O'Donnellan & Joyce

Investors were the big drivers of the Galway City market through 2014 as prices lifted for the second year off the bottom and more than two-thirds of sales in the last 12 months involved cash.

Like Dublin and Cork cities, shortage was also an influence in Galway where almost no new homes were built through the last 12 months and indeed for the past few years.

This Galway city property was on the market for €225,000 and sold in Aug/Sept 2014 for €346,000. It's a 3 bed Terrace Property.
This Galway city property was on the market for €225,000 and sold in Aug/Sept 2014 for €346,000. It's a 3 bed Terrace Property.
22 Nun's Island, Galway City, sold in January 2014 for €150,000 and again in July 2014 for €233,000, an increase of 55%.
Galway University.

But apartments in particular became the big target as investors prowling the western capital for prospects, in particular those with children coming of college age, looked to buy a stake in bricks and mortar in the university city according to Colm O'Donnellan of O'Donnellan & Joyce. Rents have risen on average by between 10pc and 15pc in the last year.

Another important development was the return of mortgage lending by the banks towards the second half of the year in particular, and this enabled first-time buyers to begin competing with investors and often win out in bidding against them.

Galway City
House Types201420152016
3-bed semi, €184,000 €200,000 €216,000
4-bed semi, €230,000 €250,000 €270,000
4-bed detached, €275,000 €300,000 €324,000
5-bed semi, €270,000 €300,000 €324,000
5-bed detached, €300,000 €350,000 €378,000
3-bed bungalow, €125,000 €150,000 €162,000
4-bed bungalow, €160,000 €200,000 €216,000
1-bed apartment, €90,000 €100,000 €108,000
2-bed apartment, €130,000 €140,000 €151,000
2-bed terrace, €140,000 €145,000 €157,000
3-bed terrace, €150,000 €160,000 €173,000
Ex-corporation 2-bed, €70,000 €80,000 €86,000
Ex-corporation 3-bed, €95,000 €110,000 €119,000
2-bed townhouse, €60,000 €80,000 €86,000
"Detached 2,000+ sq ft", €360,000 €400,000 €430,000
Large period detached, €250,000 €300,000 €324,000
Bungalow acre (outskirts), €180,000 €200,000 €216,000
Large detached period house (own grounds), €720,000 €800,000 €864,000

Demand was also strong in the city's most uppercrust enclave, Taylor's Hill, where just a handful of properties have come to market in the last 12 months. Here, where property prices are traditionally at least a quarter higher in price than everywhere else, local business bigwigs are now competing in the hunt for limited fine abodes alongside top executives from American companies, particularly those in the medical device sector.

As a result of this competition, prices in Taylor's Hill edged over €800,000 and could creep towards the €1m mark this year.

"We're predicting a strong year albeit with slightly less price growth for 2015 as investors quieten down and some new homes finally come on stream," says Mr O'Donnellan. Three-bed semis are the most common type in Galway City and also the home most in demand for family and first-time buyers.

Two sites are coming on stream this year at Ballymoneen Road and Knocknacarra with more than 70 semis likely to be completed in all. This should help sate some of Galway City's demand for family homes.

SALTHILL: Offers prospects for investors in particular with its better seafront apartments likely to outperform other property types.
SALTHILL: Offers prospects for investors in particular with its better seafront apartments likely to outperform other property types.

One of the factors which helped the Galway market find equilibrium was the success of the agency's 2014 series of multiple property "monster auctions" run by O'Donnellan & Joyce which brought in success rates of more than 80pc - close to the 90pc shown by Allsop Space's sales.

The agency has been one of the few able to produce the success of the larger Dublin base firm for the often controversial multiple sale events. This has been largely down to guide prices being pegged accurately close to the reserve prices. Other attempts to carry out multiple sale events elsewhere in the country have largely failed in recent years because guide prices had been misleading.

More than half of the properties in the Galway auctions of 2014 were in a state of receivership. However a successful run of such auctions had a positive impact in helping the market in Galway find its feet by clearing out the lingering remnants of recession at pace as well as clarifying true base values - all important for the Galway City market which showed the first signs of recovery in the second half of 2013 based on high yields, growing employment and tightening supply.

Independent.ie Guide to House Prices in Ireland

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Irish Independent

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