Wednesday 26 September 2018

Cork City South Suburbs: Inflation slowing down in Cork's swanky south suburbs

16 Elden, Maryborough Hill, Douglas, sold last February for €520,000
16 Elden, Maryborough Hill, Douglas, sold last February for €520,000

Affordability issues are starting to take a grip in Cork's better-off suburbs of Blackrock and Douglas, where some home hunters perusing the popular mid-market in the €400,000-plus range are running into bother with the Central Bank-imposed lending restrictions.

This means that inflation in the south suburbs is down from 8pc this time last year to 6pc, according to Michael O'Donovan of Savills.

"We're still seeing the same numbers of viewings for homes for sale as we did a year ago but we're not finding quite the same appetite for bidding," he says.

With little set to change in 2018, O'Donovan is predicting similar more measured inflation levels of inflation in the year ahead.

Vendors in the mid to upper end have also had to think about pricing. There were enough out-of-town buyers last year to maintain optimistic price whims but as we run into 2018, that type of buyer has been fading in potency, says O'Donovan.

Many of those returning from abroad with intentions of buying into the area in which they grew up are finding themselves priced out.

That said buyers who have disposed of, or are selling, property in places as far afield as Singapore, Hong Kong, Chicago and Brussels are still playing a big role in this market.

Brexit may have had some impact at the very top end given that Cork is a market that highend UK-based buyers favour. Detached homes on grounds are down on average from €1.6m to €1.4m as a result.

Demand remains reasonable but pricing must be right to produce a sale in this segment.

Unlike Dublin's and Galway's suburbs, Cork's seem to be providing a reasonable supply of second-hand homes to market, and while we're still waiting on sites like that at Nemo Rangers to produce houses, there has been enough available to satiate most of those seeking a property built to more energy-efficient modern standards.

These new schemes have been drawing attention from the second-hand stock for mid-range buyers in particular.

The impact of cash buyers is down this year and they now account for around a quarter of deals. This includes older couples trading down with the proceeds of a previous home sale banked.

According to O'Donovan, a "hybrid" part-mortgaged buyer is now far more common.

Homes priced in the €450,000-plus range sold well at Hazel Hill, and developers seem to be aiming squarely at the midle upper to upper price segment with launch plans for the coming year.

At the city end of the Blackrock Road, a very large site is expected to launch by Citidwell for around 30 larger homes.

Meanwhile, the unusually named Botanika at Cleve Hill has had a good launch start with homes in the late €500,000s to mid-€800,000s and there has been some speculation that some might edge above the €1m mark this year.

At Ballintemple at the Old Eircom site close to Blackrock we might also see 70 units coming to market by the end of this year.

While not enough to satisfy needs, the new home stream for 2018 will play its part in ensuring that Cork's suburban buyers won't experience damaging levels of inflation in the 12 months ahead. Vendor pricing will be the key factor in this market.

Priced more affordably were homes sold at the Eden scheme in Blackrock where the two-bed semis of 1,245 sq ft have been selling from €365,000 ,while the larger four-beds changed hands for €395,000.

This is the resumption of a site which kicked off pre-crash in 2005.

Irish Independent


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