Thursday 22 March 2018

Property Bulletin: Property Bulletin: Sales of €1m-plus homes are on the rise despite general slowdown

Old Fort Stewart, Ramelton, Donegal - €1,197,000
Old Fort Stewart, Ramelton, Donegal - €1,197,000
Walled Garden Lodges, Mount Juliet - €950,000
Paul Melia

Paul Melia

SALES of €1m-plus homes are on the rise - despite a general slowdown in the property market.

The number of houses and apartments changing hands has dropped 10pc in the second quarter of the year, but at the same time prices have risen by as much as 14pc in some areas, the Irish Independent has learned.

An analysis of official selling data shows the cost of buying a family home has rocketed across most counties, despite a marked fall in the number of properties changing hands.

Just over 8,000 houses and apartments were sold in the second quarter of the year, a drop of 10.5pc compared with the first three months, the Property Price Register reveals.

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The average price paid for a home in the months of April, May and June was €144,830, but peaked in Dublin at €344,717 - well over twice the national average. The drop in sales was most pronounced in Offaly, down 25pc, followed by Dublin (23.7pc), Galway (23.4pc) and Clare (21pc).

The slowdown in the number of transactions suggests that tighter mortgage lending rules introduced by the Central Bank are having an impact, as first-time buyers must source a deposit of at least 10pc to secure a home loan.

The lack of properties available for sale is also pushing prices up, and there has been an increase in the number of high-end expensive homes trading hands.

A total of 153 costing in excess of €1m have been sold in the year to date. This compares with 150 in the same period of 2014.

The analysis also suggests that an increasing number of house buyers are paying in cash.

Official mortgage lending figures show that in the first three months of the year, three in every 10 properties was bought without a mortgage.

There is no comparable figure for the second quarter, when some 8,058 homes were sold.

However, data from Banking and Payments Federation Ireland shows that in April and May, just 4,345 mortgages were issued, suggesting that a large portion of sellers are paying cash for properties.

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An analysis of the Property Price Register, which records the amount paid for homes, shows price hikes have been recorded in 17 of the 26 counties.

The highest average increase is in Offaly, where the price paid rose 14.5pc between the first two quarters of the year to €114,655.

Steep rises are also recorded in Kerry, up 12.9pc to €147,481, and Limerick where they rose 11.7pc to €137,000.

Increases were also recorded in the main urban areas, where demand for homes is highest,

Unsurprisingly, Dublin remains the most expensive place in the country in which to purchase a home.

The average price paid per property in the capital, which multi-unit sales are discounted, now stands at just over €344,000 - more than twice the national average, and a rise of 3pc in just three months.

In the first quarter of the year, the amount paid for an 'average' home was €334,548, indicating a price rise of €10,000 in just three months.

In Cork, a home costs €188,969 (up 10.2pc) and in Galway there was a slight rise of just €72 to €163,409.

But drops have been profound in some areas, most notably Kildare where they have fallen more than 20pc to €232,487. Prices are down more than 18pc in Kilkenny, and almost 13pc in Mayo. The counties where average prices have fallen also include Carlow, Clare, Meath, Monaghan, Waterford and Westmeath.

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The data shows that properties valued at €1.69bn traded hands in the second quarter of the year. This is down 12.5pc on the first three months, when homes costing €1.93bn were sold.

The most pronounced drop was experienced in Kilkenny where €16.6m was spent, down 26pc. Some 118 units traded hands.

There was also a sharp decline in Galway, down 23.3pc with properties valued at €65m being sold, and Dublin, where transactions valued at €796m were completed, down 21pc.

In contrast, Cork average prices rose by 10pc, while the value of transactions increased by 2pc to €172m.

The most expensive property sold in the second quarter was Embassy House on Burlington Road in Dublin on May 1 for €5.5m. It was followed by Currabeg, Woodview on the Douglas Road in Cork which cost €2.3m, followed by Clara House in Delgany, Co Wicklow which sold for €2.25m.

In 21 of the 26 counties, the most expensive unit sold in the quarter was less than €1m. The 'cheapest' most expensive property sold was in Athlone, Co Roscommon, for €253,000.

Irish Independent

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