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House price growth 'unexpectedly slowed' in Dublin in December

Experts say new schemes to help buyers are likely to push prices up again.

Image: Sam Boal/RollingNews.ie

THE RATE OF house price growth in Dublin “unexpectedly slowed” in December, bucking the trend of accelerating price growth throughout 2016.

The latest property price index from the Central Statistics Office (CSO) shows there was a nationwide drop of 0.4% in property prices in the last month of 2016.

In Dublin, prices increased by 5.8%, while house prices in the rest of the country rose by more than 12% in the year to December. The highest house price growth was in south Dublin, at 9.7%. In contrast, the lowest growth was in Fingal, with house prices rising just 3.2%.

Savills said the slowdown in Dublin was more likely to have been A temporary pause than any kind of long-term indicator.

“Towards the end of last year there was much speculation about two potential housing policy changes – the possible easing of mortgage lending restrictions and the prospect of a new Help-to-Buy scheme,” commented Dr John McCartney, Director of Research at Savills. “Anticipation of these measures almost certainly caused some potential buyers to hold off in the belief that they would have more buying power if these policies came to fruition.”

Property price register data shows that house sales fell by 23% year-on-year in December.

Both of the expected policy changes were made. Lending restrictions were slightly relaxed and the government launched the Help-to-Buy scheme which will give first-time buyers a tax rebate of up to €20,000 to put towards the deposit for a new house.

“With these schemes now active and enabling first time buyers to pay more in the market we expect the house price index to resume its upward trend,” McCartney said.

“However, due to the time lag required to collect data and compute the index, this might not be seen until March or even April.”

Read: One city has seen a huge hike in house prices – and it isn’t Dublin>

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