Home > Property > House prices set to increase by around 5% in 2019

House prices set to increase by around 5% in 2019

Written by Robert McHugh, on 2nd Jan 2019. Posted in Property

article headline

House prices are expected to rise by around 5% in 2019 after slowing sharply in the third quarter and stabilising in the last quarter of 2018 according to the latest house price report from MyHome.ie.

The report, which is published in association with Davy, predicts that robust demand and rising incomes will continue to push house prices higher once the uncertainty of Brexit has been resolved.

While asking prices nationally fell back by 0.9% and were unchanged in Dublin in the fourth quarter – as per normal seasonal trends - the annual rate of inflation nationally was 6.1% while it was 3% in Dublin.

This means the median asking price for new sales nationally is €266K down €2K from the last quarter while the price in Dublin remains unchanged at €375K. Newly listed properties are seen as the most reliable indicator of future price movements.

The author of the report, Conall MacCoille, Chief Economist at Davy, said the overall picture is that the recent slowdown has evened out, housing supply is slowly picking up - even if it remains well short of demand - and liquidity is slowly improving off a low base.

MyHome.ie estimate that the value of transactions in 2018 is up by almost 20% and will finish the year just below €18bn versus €14.9bn last year. This represents close to 5% growth in the number of sales. While the tightening of the CBI lending rules has been successful in taking some of the heat out of residential sales, one serious side effect is that this heat has been transferred to the rental market with rental inflation set to remain buoyant.

Looking ahead to 2019, MyHome.ie predict Irish banks will soon have fresh allocations of high loan-to-income (LTI) mortgage loans (exceeding the 3.5x multiple) to approve next year. While 2018 was associated with an adjustment to the tighter CBI lending rules and slowing house price inflation, the property experts expect 2019 will see robust demand and rising household incomes continue to push prices higher – albeit at more moderate levels - once the uncertainty of Brexit has been resolved.

Source: www.businessworld.ie

More articles from Property

image Description

Finance Ireland launches into mortgage market

Read more
image Description

89% of Irish dissatisfied with Government response to housing crisis

Read more
image Description

Irish mortgages arrears fell to 6% at the end of 2018

Read more
image Description

The value of residential property sales in Dublin was up almost 18% in 2018

Read more
image Description

Dublin delivers another record year for Office Investment

Read more