Saturday 18 November 2017

Limerick City Suburbs: Mattress money bottom-feeders have been and gone

11 Friarstown Close, Ballycummin Village, Raheen, Co Limerick. Sold for €337,000.
11 Friarstown Close, Ballycummin Village, Raheen, Co Limerick. Sold for €337,000.

THE big news in Limerick's suburbs is the petering out of the hard cash buyers to a point where borrowed buyers are now in with a chance.

The mattress money brigade had been dominating this market since prices turned around from the bottom two years ago.

A year ago those paying cash were accounting for around 70pc of all residential property deals closed, according to local agent Geoff De Courcy. However he says this success rate has fallen back dramatically to a more even 50/50 cut with mortgage-toting buyers who are managing to snatch more sets of deeds from bidding.

De Courcy estimates a price increase of around 10pc in the 12 months to now with a slightly less inflationary 8pc predicted for the year ahead.

He says the regrouping of the mortgaged buyer hasn't happened through any great increase in lending on the part of the banks but is rather far more to do with the fact that the post-crash investors and bottom-feeders have mostly been in and spent their cash, leaving their more cautious brethren to rake over what's available for 2016. This would also account for slightly less fizz in the market for 2016. For their parts, the investors remaining are largely seeking property priced around €100,000 - mostly in the realm of two-bed apartments and the cheapest houses.

Those family buyers who are trying to buy back into the former corpo estates in which they grew up are really the only ones still seeing cash investors pipping them to the post in the vast majority of deals.

De Courcy reports that supply has remained as tight as last year across a whole range of property types in the Limerick suburbs, but that the numbers seeking properties have increased by around a quarter on a year ago. This ties in with improving employment Shannonside. So a home that had four people chasing it a year ago will now have five.

The supply situation has the potential to get far worse because almost no new homes are coming to market in a city where starter homes are in high demand for families but still largely priced below levels which make them commercially viable for builders to become involved. De Courcy reports that that there are almost no residential schemes in the planning process and no residential development sites for sale.

The good news for family buyers is that the quality of the stock coming to market at the moment has improved considerably on a year ago when banks were disposing of far more stricken "project" properties whose boom era investor owners had fallen foul of the crash.

There is most demand for period houses on the outskirts with large sites attached and for bungalows which are extremely rare given that owners of these types tend to stay put and are least likely to sell.

Irish Independent

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