Wednesday 21 March 2018

Eurozone house prices decline at faster pace in first quarter

Demand for housing in parts of Dublin has pushed up property figures for Ireland
Demand for housing in parts of Dublin has pushed up property figures for Ireland
Colm Kelpie

Colm Kelpie

LIKE most issues related to the eurozone, the state of the housing market makes for a grim picture.

Figures published recently by Eurostat, Europe's version of the Central Statistics Office (CSO), show that the pace of decline in house prices quickened in the first three months of the year.

Prices fell 2.2pc in the eurozone in the first quarter compared with the first three months of last year, and dropped 1pc in the 17-member euro area compared with the final quarter of 2012.

The figures emphasise that while Ireland has suffered one of the worst property crashes in the developed world, we're far from alone in Europe when it comes to a depressed market.

But it's a mixed bag.

Prices are rising, in some cases quite considerably, in the north-east of the continent with Sweden jumping 4.1pc on the same period last year, Finland by 2.1pc and Estonia and Latvia recording impressive increases in their residential property markets of 7.7pc and 7.2pc respectively.

The UK has also seen an annual gain of 2.2pc.

Belgium, Luxembourg and Denmark have all registered increases also, jumping 0.8pc, 4.3pc and 1.6pc respectively.

As one might expect given the scale of the unemployment crisis and reflecting slow wage growth, Spain witnessed the biggest decline in the first three months of the year, with prices tumbling 12.8pc.

Though the data is the latest available to give a pan-European picture, it is lagging somewhat.

Although Eurostat showed a 3pc decline for Ireland, data released by estate agents Sherry FitzGerald last week revealed the stability in the housing market in Dublin was gradually starting to spread across the country.


Its latest barometer of house prices showed average prices have risen by 3.6pc in the year to date, while prices in Dublin jumped 6.1pc.

However, while there was stability, the company warned that there remained several issues of concern.

It claimed the market was recovering on the back of short supply and a pick-up in activity.

While there is some positive news for Ireland, global ratings agency Standard & Poor's forecast a gloomy year for prices across the continent.

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