Limerick city centre's property market concluded a strong year with three beds likely to break through the €250,000 mark in the 12 months ahead.
The market was transformed in 2014 with much better than expected demand, a sharp tightening up in the supply of family homes to market and an expanded cash spend among investors.
All of these factors contributed to value increases of 12pc on average says local agent Geoff De Courcy - more than twice what was predicted last year. The same is expected in 2015. This contrasts with 2013 when prices fell by 10pc, making 2014 the year that Limerick City's market rebounded off the bottom.
The pick up was gradual and steady through the last 12 months. Cash spending increased its influence on the investment market with 75pc of investors acquiring property without loan commitments. The investors were largely after apartments in prime districts which cost between €30,000 and €45,000 on average.
|Limerick City Centre|
|2/3 storey over basement,||€160,000||€180,000||€200,000|
|Large period detached,||€250,000||€300,000||€335,000|
In contrast, the cash participation of owner-occupiers fell by 70pc in 2013 to around 35pc, indicating that the banks were back in the game and loaning money again. Supply tightened by about one quarter through the last 12 months with almost no new construction work and no development sites available - one of the biggest concerns for local estate agents and buyers.
This is the key factor likely to keep prices increasing by about 1pc per month in Limerick City for 2015, says De Courcy, and it has already caused rents to rise by 10pc over the last 12 months.
The strongest demand is for large family period properties on the North and South Circular Roads. There is competition for the locals from new executives arriving in Limerick to work for expanding foreign investment companies like the US-based Regeneron which has been boosting its workforce along with Vistakon, Cooke Medical and the Northern Trust Bank. While many of these firms are located in the suburbs, executives coming from abroad and other Irish cities want to buy or rent in the preferred areas.
This is why larger detached period homes hiked by €50,000 through the year with Georgian style terraces upping in value by €20,000. However, almost all larger period terrace homes coming to market are now in need of a huge amount of work and some cost even less than a standard semi as a result.
Sadly, many of the tall elegant Georgians which characterise much of the centre of Limerick City have fallen into very poor condition. The sheer cost of renovating these properties for private residences means that many continue to languish in degenerate condition and therefore remain among the cheapest properties to buy in the city centre area on a square foot basis.
Mr De Courcy adds: "Apart from supply, our other big worry is the pending Central Bank measures to seek a deposit from buyers of 20pc. We'd prefer this to be phased in rather than introduced suddenly - to prevent a shock to the recovering market. If it does happen this year then we might expect demand from first-time buyers to fall - maybe by as much as half. It's hard to tell at the moment how that might go but there's no doubt that many potential buyers would have to postpone.
"It takes perhaps four years for a couple to save a 10pc deposit."