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House prices rise 5% as supply falls to lowest in over a decade

Some urban areas saw an increase of up to around 10% in the cost of housing between June and September.

Image: Leah Farrell/Rollingnews.ie

THE AVERAGE COST of houses rose by nearly 5% in the third quarter of 2020, according to the latest Daft.ie House Price Report.

Between June and September, the average listed housing price increased by 4.8%.

The number of properties available to buy across the country was slightly under 17,700 on 1 October, which represents the lowest figure in over 14 years and a decrease of almost one-third compared to last year.

Some urban areas saw an increase of up to around 10% in the cost of housing between June and September.

In Waterford city, the average price rose by 11% in the third quarter. In Galway city, they rose by 10%, and Cork and Limerick saw an increase of 9% during the three month period.

However, in Dublin, prices only rose by an average of 2.2%.

Outside of cities, the average increase was 5.8%. Leinster saw an increase of 7.3%, while the cost of housing rose by 3.5% in Connacht and Ulster.

Ronan Lyons, author of the Daft.ie report and an economist at Trinity, said that jump in prices was “not entirely unexpected”.

“Indeed, it brings the Irish housing market into line with many other housing markets in high-income countries, where Covid-19 has not disrupted the long-term upward trend in housing prices,” Lyons said.

Lyons said that the “collapse” in listings in April and may had resulted in a fall in stock on the market.

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“This highlights the underlying issue affecting the Irish housing system – a prolonged and worsening scarcity,” he said.

The significant fall in completion of new homes to be registered in 2020 may prove a temporary blip. Nonetheless, the level of new home construction even in 2019 was barely half of underlying need,” Lyons said.

“While the public health emergency clearly dominates policymaker attention currently, longer-term challenges should not be forgotten. Chief amongst these is the lack of housing – especially for smaller households, in or close to Ireland’s largest cities and towns.”

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