Irish residential property prices continued to flat line in October according to new CSO data published today. Prices rose by 0.1% month on month (mom) with similar results in Dublin and outside Dublin.
On an annual basis, prices grew by just 0.9% year on year (yoy) (1.0% yoy in September), the slowest rate of growth since mid-2013. In Dublin, property prices fell 1.5% yoy, the third consecutive month of annual decline. Outside Dublin, HPI is running at 3.3% yoy having run at 7.8% earlier this year.
Goodbody Stockbrokers say this suggests very modest single-digit growth in prices nationwide. Looking to 2020, a relatively high stock for sale in Dublin suggests that price trends will continue to stagnate over the coming months, but a more certain economic climate post-Brexit (depending on the results of today's UK election of course) may help increase transactions and prices.
Due to base effects from November 2018 onwards, Goodbody believe that Ireland may now have seen the trough in house price inflation in October.
Separate transaction data points to a moderately improving trend over recent months. In the three months to October, residential market transactions grew by 14% yoy, with new home transactions up by 19% yoy and existing home transactions up by 12% yoy. Within this, non-household purchases continue to surge (+59% yoy) in both the new homes and existing homes sectors.
There has been, however, a modest improvement in household trends; in the three months to October, household purchase grew by 5% yoy, its best performance since February 2018. New home purchases by households grew by 3% yoy with existing home transactions up by 5% yoy.
According to Goodbody Stockbrokers, "The most disappointing region has been Dublin, led by a fall in new home transactions (-8% ytd). This implies that the stock of unsold new properties has risen in Dublin, with our analysis this year suggesting that it is mostly felt at the higher price points. This feature is likely to contribute to a more cautious approach to new supply, while this week's legislation in relation to rent freezes in the rental sector may lead to delays in the delivery of buy to rent (BTR) product."