Leitrim: New lending restrictions hurt top end of Leitrim market
New lending regulations have been impacting in some unexpected places, one of them is at the top end of the market in Leitrim, one of Ireland's least populated and cheapest counties, where a home fit for a king can be picked up for €300,000 - but they're not because of the difficulty saving a deposit, says local agent Liam Farrell of DNG Farrell.
"I thought it was going to be more of an urban problem but it has certainly had an impact on the market in Leitrim. There are people out there with very good earning power but they don't have €40,000 in the bank. They are well able to afford the homes but don't have the ability to get a mortgage," says Farrell. "I think it quite a cruel mechanism and feel there must be a better way of applying it."
Sales of larger country properties were quite disappointing for Farrell as a result. "The UK market has always been very strong around here, usually with holiday cottages and the like, and I thought we'd be flying this year with the strength of sterling, but they're not coming in significant numbers for some reason. It's hard to figure out."
Overall however, the price recovery has been steady in Leitrim through the last 12 months with increases of 5pc generally, and stock levels are now low.
"The year ahead will be interesting with no building taking place," says Farrell. "We still have a few investment properties that are being sold by the banks but I think we're heading into the last purge of that. There are couples out there who are very eager to buy but we don't have anything to replace the repossession properties once they're sold."
There has been a strong appetite for buy-to-lets in the past year, with particular interest in three- and four-bed semis that are priced at around €90,000-€100,000.
For the ordinary buyer though, the market is becoming quite tricky. Farrell thinks the new Central Bank regulations that require a 20pc deposit for a home over €220,000 are having a negative affect in the county.
Farrell believes the market in Leitrim will continue to grow in 2016 at a steady pace of about 6pc.