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Dublin house prices fall by 12.5pc

PROPERTY prices in Dublin have taken another sharp dip, with a 4pc drop in the first three months of the year.

The latest fall brought the annual drop to 12.5pc, according to a report from Sherry FitzGerald.

It means that prices are back at levels achieved in the second quarter of 2002.

The latest drop was slightly less than the 13.2pc decrease recorded nationally in the 12 months to March 2011.

Dublin house prices have fallen 55.8pc from their summit in 2006, while the national figure revealed a 51.1pc drop.

In January, there was a total of 53,300 properties for sale nationwide, of which 6,800 were located in Dublin city and county.

This was lower than the number of For Sale properties recorded in July 2010.

First-time buyers are buying more properties than any other grouping -- they account for 45pc of the homes bought in the year to date.

Marian Finnegan, chief economist with Sherry FitzGerald, pointed out the stock of available second-hand properties is continuing to decline. She added that there were limited new properties coming on the market, while she said there is "growing anecdotal evidence" of a stronger rental market.

However, she does not see "true stability" until our banking crisis is resolved.

Ms Finnegan said: "The greatest obstacle for all markets in the year ahead lies in the availability of credit. As previously stated, true stability will only be achieved with a normalisation of the credit flow in the economy."

She admitted the rate of decline in prices remained quite strong between January and March 2011.

Ms Finnegan said this was a reflection of the negative consumer sentiment and worries about the wider economy.

In a separate development, property consultants CB Richard Ellis said there were only two investment transactions completed in the Irish property market in the first quarter of 2011.

They attributed this directly to plans by the new Government to retrospectively review rent provisions in existing business leases.