Sunday 18 November 2018

Property prices rise by more than €100,000 in a year amid fear of Celtic Tiger-level hikes

(Stock photo)
(Stock photo)
Paul Melia

Paul Melia

AVERAGE house prices in some parts of the country have risen by more than €100,000 over the last year as the crisis shows no sign of easing.

Data from the Central Statistics Office (CSO) shows in eight Dublin postcodes, three in Cork and in towns across 12 other counties, the average price paid for a new or second-hand home increased by more than €100,000 since January 2017.

It comes amid warnings of prices rising to Celtic Tiger levels by the latter half of next year, and after the Government this week effectively admitted that 'affordable' units costing no more than €320,000 were not being developed.

The lack of homes costing between €240,000 and €320,000 - which a Department of Housing report said indicates an 'affordable' price - means that thousands of aspiring homeowners will be forced to remain in rented accommodation and subject to steep hikes.

Official data highlights how prices are increasing way in excess of the 13pc average in many areas of high demand.

The CSO property price index analyses the median, or mid-point, price paid for homes, broken down by postcode. This includes all property types sold, ranging from a one-bedroom apartment to an expensive period property.

It shows across all property types, the median price paid in February this year was €235,000, up €30,000 or 14.pc on January 2017.

But they have risen by more than €100,000 in 10 areas - Dublin 4, Dublin 14, Dublin 7, Dublin 9, Dublin 18; Mitchelstown in Cork, Boyle in Roscommon, Clones in Monaghan, Kilmallock in Limerick and Greystones in Wicklow.

Of 135 postcodes for which data is available for all housing types, prices have risen in 103 areas. They rose by 50pc or more in 18 of these areas. They dropped in 30.

In relation to new homes, prices rose from €295,000 in January last year to €330,000 in February. In 13 areas, they increased by more than €100,000.

They are Dublin 7, 14 and 18; Bray and Greystones in Wicklow, Athy in Kildare, Westport in Mayo, Gorey in Wexford, Donegal town, Cork southside and Midleton, Galway and Carlow.

Of the 89 areas for which data is available, new homes for less than €240,000 were only available in 35. In the capital, homes for €320,000 or less were only available in Dublin 8, 11 and 22.

There are a number of reasons why price rises are so pronounced in some areas. Sources suggest that in some areas of high demand, more expensive homes were being recently sold compared with a year ago. In other cases, unfinished units may have been purchased by a developer at low cost, before being completed and sold.

The most recent data from the Property Price Register shows that between 2016 and April this year, more than 114,000 property transactions were completed. Of these, more than 1,500 were individual properties which changed hands at least twice. For example, one home in Ringsend was purchased in May 2017 for almost €318,000, before being re-sold in February this year for €537,000.

It could also be the case that, 13 months ago, the bulk of homes sold in a particular area were, for example, apartments. But in recent months, larger detached homes may have been completed which resulted in the surge in price rises.

Rising prices are also affecting the cost of buying an existing property. The CSO data shows in 134 postcode areas, the cost of a second-hand unit has risen by more than €100,000 in 12 - Dublin 4, 6, 7, 9, 13, 16 and 18; Greystones in Wicklow, Mitchelstown in Cork, Boyle in Roscommon, Clones in Monaghan and Kilmallock in Limerick. However, in 35 areas they fell - including Dublin 2, 3, 6W and 14.

The Government's Rebuilding Ireland programme aims to boost output to 25,000 units a year by 2020. The figures highlight the mounting pressure all aspiring homeowners face in trying to purchase a property.

Irish Independent

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