Residential property prices (houses and apartments combined) at a national level rose by 8.1% in the year to December according to new official figures released this morning.
Overall, the national index is still 32.1% lower than its highest level in 2007. Dublin residential property prices are 32.8% lower than their February 2007 peak while residential property prices in the Rest of Ireland are 36.3% lower than their May 2007 peak. From the trough in early 2013, prices nationally have increased by 49.1%.
In the same period, Dublin residential property prices rose by 64.3%, while residential properties in the Rest of Ireland index increased 46.6% from their lowest point.
In Dublin, residential property prices increased by 5.7% in the year to December. Dublin house prices increased 5.8% whereas apartments rose 7.9% in the same period. As with November, the highest house price growth in December was in South Dublin, at 9.7%. In contrast, the lowest growth was once again in Fingal with house prices rising just 3.2%.
Residential property prices in the Rest of Ireland (i.e. excluding Dublin) were 12.0% higher in the year to December. House prices in the Rest of Ireland rose 12.1% over the period. The West region showed the greatest price growth, with house prices increasing 17.8%. Conversely, the Mid-East region showed the least price growth with house prices rising 7.6%. Apartment prices in the Rest of Ireland increased 9.5% in the same period.
Merrion Stockbrokers have today warned that a lack of supply of houses has clearly pushed up prices, particularly in the Dublin area in the past few years, but it is not something that can be rectified overnight. Until this issue is addressed, they believe prices in the capital and its outskirts will likely remain elevated, even with “Brexit” related risks.
They predict house price growth will remain in positive territory on a year-on-year basis for a while yet, with the annual rate of increase set to hold in the 6-9% range over the next few months.
According to Merrion Stockbrokers, "The easing of mortgage lending restrictions imposed by the Central Bank combined with the tax-incentive scheme for first-time buyers announced in the October Budget will keep upward pressure on prices until new supply comes on the market.
They added, "The real question is whether we need this type of incentive at all, with politicians seemingly not learning their lesson from the property crash/financial crisis."
Source: www.businessworld.ie
