Houses in Dublin’s suburbs could reach Celtic Tiger levels by Christmas, according to Owen Reilly.
“Unfortunately from a buyer’s point of view, it’s looking like values are going to rise in Dublin this year by at least 10pc,” he said. It is “possible” prices will rise to Celtic Tiger levels by December.
“Different locations are seeing varying trends. There is a big difference between the city centre urban market and the suburban housing market. The city centre apartment market is not seeing anything like the same level of demand that suburban houses are. So there are only certain types of properties that are going to go up at least 10pc this year.
“We are talking about houses close to the city centre in the suburbs — houses along the canals and in the suburbs of Dublin 4, Dublin 6, Dublin 8. Everyone is looking for more space.”
He said in Dublin’s most sought-after suburbs “a lot of buyers are looking for the same type of house on the same roads”. As a result, he said “values of certain houses on certain roads” are “up by 10pc to 20pc” in some cases “since lockdown ended”.
“I put a house recently on the market for €2m in Dublin 4 and I thought if we got €2m it would be a very good result. That house was agreed at about 15pc above asking price.
“Normally when sellers see this level of demand it encourages them to sell, but that’s not happening now. They say ‘it’s all well and good that it’s a great market for selling but where am I going to go?’ The only way it’s going to settle down is if more houses come on the market.”
He said despite rising prices it’s not all good for estate agents.
“From an agent’s point of view we would prefer to see a more normal market, with no price inflations but more transactions.
“Our transactions are down 30pc for the year because of the low supply. So we are working really hard but transactions are still down significantly from the same period last year.”
Fergal Leonard
Director at DNG Maxwell Heaslip and Leonard, Galway
When the pandemic struck last year Fergal Leonard had to return 90pc of the deposits held for properties that had gone sale agreed because of uncertainty in the market.
With three months of income wiped out immediately, he was concerned about keeping the office open, but pent-up demand prevented the market from “falling off a cliff”, he said.
“Within three months, all bar two properties were resold again for the same price,” he said.
Since then, prices have continued to increase steadily, with agents and builders struggling to meet demand.
“Prices in some areas are up 10pc in the past six months. Three-bedroom semi-detached homes in Knocknacarra, west of the city, which sold for between €325,000 and €335,000 two years ago, recently changed hands for €392,000.
“There is a significant number of cash buyers looking for homes at the upper end of the market, with the levels of debt being taken on much lower now than in the past.
“Demand for new homes is substantial. First-time buyers can avail of the Help to Buy scheme if they purchase a new home, but other buyers know they can also make savings by buying new. However, this is a problem because there is little supply to meet this demand after Covid-19 halted construction.
“A 2,000 square foot house will cost you €2,500 per year to run for electricity and heat. People realise if they can afford to buy new they can save on bills in the long term.
“Some people think auctioneers love this type of a market, where everything is so frantic. We don’t. The problem now is we can’t get enough stock.”
Lisa Kearney
Director and head of residential and new home sales at Rooney Auctioneers, Limerick
The property market in Limerick is far from perfect, Lisa Kearney admits. There are plenty of reasons why some prices rose by up to a third inside the space of a month earlier this year, but very few short-term solutions. Supply is an issue, as is the density of new developments that she feels downsizers are reluctant to consider.
“It’s a bit of a perfect storm at the moment,” Ms Kearney said of a very “congested” market rife with competitive bidding.
In March a three-bed end-of-terrace near the Ennis Road, to the north of the city centre, came to market at €298,000. It was viewed by 33 people and sold for €370,000 a month later. Around the same time, a small 1920s home in the city centre came to market at €230,000 and sold for €308,000 in April.
“When people hear that a property has been bid up by €70,000 or €80,000 over the asking price, that should make them realise we have to do something about supply,” she said.
“In our job you know a house might be worth about €270,000 but is going to end up at €370,000 because of bidding and lack of supply. It’s very hard.
“The part I hate is having to ring a young couple and say, ‘it has now gone up again’. It’s a nightmare.
“It is scaring people and the more afraid they get the more they rush and get into bidding situations.
“They need to take this frantic bidding and viewing out of it.”
Ken MacDonald
Managing director of Hooke & MacDonald
“House prices are rising and most of the money available is for the top end of the market,” said Ken MacDonald.
He pinpointed “big houses in Glasnevin, Drumcondra, Clontarf, Glasnevin and Raheny on the north side of Dublin and Mount Merrion, Blackrock and Donnybrook on the south side” as attracting particularly strong interest.
“There is a good volume of money available for houses in these locations and serious demand, so it is impacting on prices.”
He said the shortage of houses is “pushing up prices by 3pc to 5pc on average per year” but “in the locations I named” it would be in the 5pc to 7pc bracket, “where homes are particularly mature and very popular”.
“Many are trying to buy homes in the neighbourhoods they grew up in. People who were brought up in north Dublin like to stick to north Dublin and people who were brought up in south Dublin like to stick to south Dublin.”
However, he would encourage buyers to look elsewhere for the medium term.
“I would tell people to buy now, if they can find a property. I think by focusing solely on the areas that they really fancy they are excluding themselves from the possibility of a home in maybe a location that is not their preferred location.
“They can move in five or six years’ time to the area they want. But I think it’s a mistake for people just to focus on a small location and I would say they should take a wider perspective.”
On whether prices would continue to rise, he said: “It’s all down to the shortage and demographics. I saw Leo Varadkar said last week that the new target he wants to put forward is 40,000 homes a year, but what we have been saying is 50,000 new homes are needed each year and economists Ronan Lyons and Brian Hughes and Davy’s are all saying the same.
“The big difference between now and the Celtic Tiger is at that stage 87,000 new homes were being built per year, whereas now we are building a quarter of that, 20,000.
“That’s the safety valve we have. We are also not building the volume of homes that were being built in parts of Ireland where there was no demand. Now the opposite is the case and that is the safety valve for the market.”
Kevin Barry
Managing director of Barry Auctioneers and Valuers, Cork
“It’s definitely a sellers’ market at the moment and a fantastic time to sell,” according to Kevin Barry.
Like in other parts of the country, demand is outstripping supply, but the upper end of the market is particularly acute.
Price increases this year are most notable among three-bedroom semi-detached houses in Cork city’s suburbs. One such home in Glanmire sold for €260,000 last March.
“A similar type three-bed house in the same estate went on the market two weeks ago. We have had over 30 viewings so far and the current offer is over €300,000,” he said.
“Another example is an apartment in Ballinlough which we had agreed last year for €310,000 and fell through due to Covid-19. It sold recently for €337,500.
“At the higher end of the market, the €800,000-plus houses, there is a severe shortage and there are currently only eight houses at this price and above listed on Daft.ie in Cork city and suburbs.”
He said the market has been extremely busy since the lockdown restrictions eased, with many people who had saved money over the previous 12 months adding to the already heightened demand.
He said extending the Help to Buy scheme to include second-hand homes might help the supply issue here, as more first-time buyers might consider opting for second-hand homes.
“There is a section of the market for which the pandemic has not affected their wages and the people in turn have saved in their household spending, so they can afford a bigger mortgage.”
