HOUSE PRICE INFLATION has surged ahead in the first three months of this year, according to new figures from MyHome.ie.
The website’s new house price survey found the mix-adjusted price on newly listed properties rose nationally by 5.5% in the first quarter of this year, while Dublin prices rose even higher – by 6%.
For the entire stock of properties listed for sale on the website prices rose 1.6% nationally and 1.7% in Dublin. The national mix adjusted figure is now €218,000 while in Dublin its €303,000.
In Cork asking prices were up 8% on the year to €216,000 while the increase in Cork City was even stronger at 9.3% with the median price now at €235,000. Limerick saw one of the sharperprices gains, up almost 15% to €155,000. In Limerick city prices rose to €150,000.
In Galway asking price inflation was 11.4% with the median price now €195,000. In Galway city prices have increased by 12.5% to €225,000. In Waterford prices were up 3% on the year to €165,000 and by 13.6% in the city to €125,000.
The price of the most popular house type the three-bed semi rose in 20 counties was unchanged in four and was down in just two.
The price for a typical three-bed in Dublin is now €219,000.
Connacht saw some of the biggest gains with three-bed semis in Galway rising by 18%, while they were up 17% in Sligo and 16% in Roscommon.
The author of the report, Conall MacCoille, Chief Economist at Davy, said Ireland’s strong recovery, the ‘Help to Buy’ scheme, looser credit conditions and the lack of housing supply are likely to combine to make it a frothy year for Irish house price inflation.
“Credit conditions are clearly supporting the market. The average mortgage approved to first-time-buyers in February was €206,500 up by an enormous 15.2% on the year from €179,000. This must in part reflect the relaxation of the Central Bank rules, eliminating restrictions on the availability of 90% loan-to-value mortgages.”
“In addition, would be first-time-buyers are now also armed with the ‘Help-to-Buy’ scheme which is likely to push-up the price of newly built homes. Indeed, on price inflation on newly built homes has now accelerated to 12%, well above the 5% rise in the asking price on the stock on second hand homes.”
“While homebuilding activity is clearly stepping up, it is clearly not happening fast enough. The 14,900 homes completed in 2016 was still the lowest number since 1970, excluding the recent past.”
Managine director Angela Keegan pointed out the website’s stock of homes has dropped by 10% on last year.
“The lack of supply will only make first-time-buyers ever more desperate, intensifying the competition for the limited number of homes for sale and encouraging would-be buyers to take on higher mortgage debts.”
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