Friday 20 July 2018

Number of properties for sale just a third of what was available in 2009

The shortage of housing is driving continued price inflation as the average cost of a home rose by more than €20,000 during 2017. Photo: Stock
The shortage of housing is driving continued price inflation as the average cost of a home rose by more than €20,000 during 2017. Photo: Stock
Gareth Morgan

Gareth Morgan

The number of properties available to buy nationwide has plunged to 21,000, just one-third of what was available in 2009.

Figures for properties on sale have now fallen year-on-year for 100 months - having been above 62,000 eight years ago.

The shortage of housing is driving continued price inflation as the average cost of a home rose by more than €20,000 during 2017, according to the latest report from property website Daft.ie.

With prices stable in the final quarter of the year, this means the average price was almost €241,000, 9.2pc higher than a year ago.

Compared with their lowest point in 2013, prices nationwide have now risen by an average of almost 47pc, or just over €76,500.

It was a 'year of two halves' as the Central Bank relaxed its minimum deposit rules, in particular for wealthier first-time buyers.

Economist Ronan Lyons. Photo: Damien Eagers
Economist Ronan Lyons. Photo: Damien Eagers

Whereas previously any mortgage credit above €220,000 required a 20pc deposit, the changes meant all first-time buyers required no more than a 10pc deposit, no matter how large their mortgage.

Ronan Lyons, economist at Trinity College Dublin and author of the Daft.ie report, said: "The main feature of the property market in 2017 was just how different the second half was from the first.

"The first half of the year saw prices jump by 9pc in six months, as the relaxation of Central Bank rules for first-time buyers was factored in to prices.

"But the second half of the year saw almost no change in prices, as those very same rules linking mortgages to the real economy placed a brake on prices.

"The overall picture of the market remains one of strong demand but very tight supply, in particular of new homes. As we enter 2018, increasing supply - especially of apartments in Ireland's major cities - must become the key success metric for policymakers when it comes to the housing market."

According to Daft, prices in Dublin rose by 11.7pc during the year - the first since 2014 that the rate of inflation in the capital exceeded the national average.

In Cork, the change in prices during 2017 was 5.1pc, while in Galway the figure was 8.1pc. In Limerick city, prices rose 6.9pc during the year, while in Waterford the increase was 8.6pc. Outside the main cities, prices rose 7.5pc during 2017.

Martin Clancy from Daft.ie said: "Interest and demand in the property market continues to grow.

"We are now seeing more than 1,000 property searches taking place every minute on Daft.ie."

Irish Independent

Business Newsletter

Read the leading stories from the world of Business.

Also in Business