Tuesday 21 November 2017

Family properties lead the recovery as lack of supply begins to push up prices

Paul Melia

Paul Melia

PRICES for three- and four-bedroom family homes have risen in Dublin and certain pockets of other towns and cities, a survey of the Property Price Register shows.

Experts said the main shoots of recovery were in the capital, Galway and Cork, but that the rest of the country was a "mixed bag".

The data shows that of 22 areas surveyed, eight have risen in value between 2010 and 2012.

But when you compare 2011 and 2012, half of all homes surveyed had fetched higher prices.

The data shows:

* Prices in popular residential areas in Galway – Renmore and Rahoon – rose between 2011 and 2012.

* In Dublin, increases were recorded in Cabra, Clontarf, Castleknock and Tallaght, popular areas with first-time buyers or those looking to upgrade.

* But there were falls in Dundrum and Leopardstown, where thousands of new homes were built during the boom, and in Swords, Blanchardstown and the city centre.

* Limerick has also seen an increase, but prices are down in Sligo.

* In Athlone, location is key, with prices rising in some parts but falling in others.

In terms of house sales, chief economist with Sherry Fitzgerald, Marian Finnegan said the main recovery was in Dublin, Galway and Cork where there were relatively few homes for sale, but a market of people with cash to spend.

"If you look at the stock of available properties, there's 1.8pc in Galway and 2.3pc in Cork city, which is relatively low. People are more competitive when the available stock tightens," she said.

"These cities have lower levels of unemployment and greater incomes, so you'd expect the market to be improving. Kildare, Wicklow and Meath are also experiencing an upsurge, and a lot of that is overspill from the Dublin market.

"The rest of the country is a mismatch. Sligo, Roscommon and Wexford have seen quite a bit of uplift in activity of up to 40pc, but it does seem that prices are generating activity.

"Different streets in towns perform differently. There's an element of a herd instinct. Once someone makes a decision, it gives someone else the impetus to make a decision."

In Dublin, there were fewer homes available for sale at the start than needed to meet demand, she added. She said prices could rise by 10pc this year.

ACTIVITY

"In January there were 6,400 units advertised for sale, but 8,000 units sold last year. There isn't even a year's supply. We're seeing a 1pc increase in value in Dublin per month so far this year. I'd say in Dublin they'd be up 10pc at the end of the year. Everybody is looking for three- or four-bed properties. Apartments have stabilised. The upper end of the market is cash-driven, so it's a whole different world."

The larger cities of Waterford and Limerick would improve further, as they were home to a large population.

But much of the activity would remain focused in Dublin – at least in the short term.

"Pretty much Dublin prime locations are where that's happening," Ms Finnegan added. "You're looking at Ballsbridge, Foxrock and Clontarf, where there's a shortage of family homes and people have cash.

"You might see a general growth of 1pc per month, but it could be 10pc or 15pc in certain districts. For family-type homes, there seems to be a lack of supply."

Experts said there was also huge demand for sites in the capital that were suitable to build smaller schemes of up to 30 houses.

Data from CBRE shows there were 16 land sales worth €28.6m so far this year.

Irish Independent

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