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Property price rises gather pace as Covid squeezes supply


Stock image. Photo: Andy Dean Photography

Stock image. Photo: Andy Dean Photography

Stock image. Photo: Andy Dean Photography

PROPERTY price inflation continues to gather pace.

Prices were up by 3pc in February compared with the same month a year ago, according to the Central Statistics Office.

It was the fastest rise in prices in nearly two years.

Experts are predicting that prices will continue to rise on the back of constrained supply.

In Dublin, prices were up by 1.2pc in the year, but outside the capital there was an increase of 4.7pc, the CSO said.

The month of February saw prices up 0.3pc compared with the previous month.

Experts said demand for homes was strong up due to a build-up of savings for those that have been relatively unaffected by the lockdown as they can work from home.

And a big driver of the price rises is a lack of supply of new and second-hand homes for sale.

A recent Daft.ie report found the stock of properties available for sale fell by 40pc over the past year as many homeowners are reluctant to sell in the middle of a pandemic.

New supply has been hit hard by repeated lockdowns.

Chairperson of Association of Irish Mortgage Advisers Trevor Grant said prices would keep going up in the medium term.

“Stock for sale is now at an all-time low across the country and this must apply pressure on prices to increase in the coming months.”

When house prices only, and not apartment prices, are looked at the South East saw the largest increases at 6.6pc in the year to February.

The Border area saw a 0.8pc fall in prices, the CSO said.

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Buyers paid a median, or typical, price of €262,000 for a home in the year to February.

This is up €1,000 from the median price paid in January.

In February, the Dublin region had the highest median price at €385,000.

Within the Dublin region, Dún Laoghaire-Rathdown had the highest median price at €537,592, while South Dublin had the lowest at €354,999.

The highest median prices outside of Dublin were in Wicklow at €355,000 and Kildare at €325,000.

The lowest price was €110,000 in Leitrim.

In the year to February, 38,025 household dwelling purchases were filed with Revenue.

A third of these were purchases by first-time buyer owner-occupiers.

Movers bought 20,222 units, representing 53.2pc of the purchases.

The balance of 5,131, or 13.5pc, were acquired by non-occupiers. This category is represented by cuckoo funds and State-backed housing bodies and local authorities.

Revenue data shows that there were 1,000 first-time buyer purchases in February, an increase of 4.2pc on the 960 recorded in February last year.

These purchases were made up of 235 new dwellings and 765 existing dwellings.

The CSO said 3,205 household dwelling purchases were filed with Revenue in February alone, a rise of 7.4pc increase compared with the same month last year.

The total value of transactions filed in February was €991m.

Overall, the national index is 15.5pc lower than its highest level in 2007.

Dublin residential property prices are 21.2pc lower than their February 2007 peak, while residential property prices in the Rest of Ireland are 17.5pc lower than their May 2007 peak.

Property prices nationally have increased by 88.5pc from their trough in early 2013.

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