Mark Keenan: 'House prices may be falling, but more and more are being excluded from home ownership'
It is undoubtedly good news that property prices in most parts of Dublin are now falling - by a grand or more every month. May they keep on going downwards.
Because in the absence of confetti lending for mortgages - quite the opposite has been happening - we don't have to worry about a crash of the magnitude we experienced from 2007.
At €433,000, the average three-bed Dublin semi is still well out of reach of most of the people it was built to house. It needs to be cheaper.
To put it in context, Dublin is currently almost twice as expensive for average homes than the big regional cities and four times more expensive than most of our regional towns. It's far too much.
Even if you're a landlord with multiple units, you won't be overly bothered with this type of slippage, given rents are still surging ahead and you're still benefiting from unrealistically good yields.
Lower property prices mean smaller mortgage payments (for those who can get a mortgage) and therefore more money available on a sustained basis (30 years) to spend in the economy overall: in shops, restaurants, on weekend breaks and on other job-creating and sustaining items and activities.
While the Central Bank's lending limits have long been suppressing sales in the market for homes more than €300,000 in Dublin, it is largely the increased availability of new schemes which is knocking values for six in many parts of the capital. This will continue as more new homes are built and come to market.
But there are other factors at work in taking down prices. Those working in firms which might be affected by Brexit are likely to have postponed purchasing. So there is Brexit uncertainty. The cost of hiring builders for domestic refurbishments has surged and therefore devalued plenty of those older homes for sale which require work.
In the capital, that's a lot of properties. Last week an agent told me that most of those tired homes for sale need their asking prices to come down by 5pc to 10pc to make them saleable.
It is perhaps unfair, but necessary, that those buying new homes have benefited from the Help to Buy scheme as well as vastly improved energy efficiency under A-rated homes.
Help to Buy is in fact subsidising new homes at the expense of second-hand properties. But incentivising new home construction makes for more new homes and in turn brings property prices down - as it is doing now in some pockets.
We are now seeing in Galway city and Cork city that prices are beginning to hit those loan-to-value limits for average home buyers. This is the reason for a slowing in property price increases within city limits and the surge in values we are seeing in the county areas, as younger people move out in search of homes for which they can get a mortgage.
But in many towns we are seeing a more unusual phenomenon at work, with a second-hand home still much cheaper than the overall cost of building a new property. This means no new properties (save traditional one-offs on own land) are being built, nor are likely to be. In turn this is pushing up prices.
Co Longford and Co Leitrim are good examples, with prices for average semis now surging in Leitrim at a rate higher than 1pc per month.
But while mortgage loan ceilings are keeping us out of a dangerous property crash saga, there is a high price to be paid.
In Dublin, most young people are now being excluded entirely from home ownership and many have already been priced out of rental as rents show no sign of cooling off and international funds continue to hoover up a large chunk of the new homes being completed.
For the most part in our big cities we've tackled runaway property price inflation, but the reality is that we've done it by excluding more and more from home ownership.