Ireland: Residential Property Review
The latest analysis on residential property prices in Ireland show an increase of 12.4% in the year to May 2018. The numbers also indicate that residential prices in Dublin may be slowing but only slightly according to new analysis from PropertyWire.
The Central Statistics Office reports that Dublin home prices increased 10.7% with the rest of Ireland having a price growth of 14.1% per annum.
Home prices increased by 10.7% in Dublin with higher annual growth of 14.1% in the rest of Ireland, according to the date published by the Central Statistics Office. Prices for apartments have increased by 13.5% within the last year. Dublin City prices were at 14.6% and South Dublin with the lowest growth for price increases for housing at 6.6%.
Rachel McGovern, Director of Financial Services at Brokers Ireland tells the Irish Independent regarding the moderation in housing supply:
"Dublin has seen the greatest level of supply. However, overall there is huge pent-up demand, with levels estimated to be of the order of 40,000 per year.
"The CSO’s new data shows a mere 14,446 new dwellings were completed in 2017.
"On that basis last year’s supply level would need to increase by well over 176pc to satisfy current yearly demand.”
For the rest of Ireland country house prices have gone up 13.7% and apartment prices have risen by 15.5%.
The Mid-West region had the largest percentage of growth for home prices with 22.1% with the Border region having the lowest price increases of 3.7%.
The current national index is lower at 20.4% since it peaked in 2007 with Dublin prices being 22.5% lower than their levels in February 2007 with the remainder of Ireland are 25.5% lower their peak in May 2007.
From the period of 2013 home prices across Ireland have increased by 77.7% with Dublin having increased 91.9% from their lowest rate in February 2012. Since the lowest increase since May 2013 price increases nationally in Ireland home prices have risen 71.4%.
The median price paid for homes from the previous year to May is at €235,000 with median prices being the highest in Dublin at €359,000. The areas around Dublin Dún Laoghaire-Rathdown had the highest median price at €528,500 and Fingal the lowest at €315,000.
Away from Dublin Kildare median prices for homes are at €277,250 and Wicklow with the highest median prices at €310,000.
The lowest median prices were in Longford at €91,000 and Leitrim and Roscommon, both at €95,000.
Savills indicates that house prices could decrease 8% by the end of 2018 as a new supply of homes is brought to the market.
Sean O’Malley, Savills senior economist predicts:
‘While the market clearly remains undersupplied, increased construction activity is slowly bridging the gap between demand and supply. The impact of this will be to gradually moderate the rate of house price growth.’
Whilst inner city dwellers in and around locations in Ireland mainly in Dublin deal with increased home prices and rents one city that is ranked as the most affordable is Limerick. In a report by economic consultants EY-DKM Economic Advisory reports that Limericks appeal for a variety of reasons:
“In addition, higher than national average levels of disposable income, as well as collaboration and engagement between business, third level and statutory bodies were among the factors cited as giving the Shannon-side city an advantage over other urban areas.”
But challenges for the city remain and the report cited a number of issues that the city government must address such as deterioration in the city centre and unemployment blackspots in parts of the city.
James Collins, mayor of Limerick tells the Irish Independent:
"Limerick is the urban success story of the recovery and this report confirms that, while realising that there continues to be ongoing challenges.”
The city has however seen over 12,000 jobs created in the past five years which Mr. Collins says:
"That's unprecedented growth for Limerick.”
"We need to focus and be moving forward with ambition to be the best city in Ireland to work, live and play in."
Could Brexit make Limerick attractive for UK businesses?
The EY-DKM Economic Advisory reports says that the city’s cost of living and business climate makes Limerick more attractive than other locations in Ireland.
One industry collaboration is the ‘Limerick for IT’ and 'Limerick for Engineering' ain attempt to standout from other locations and encourage investors.
Ciara Morley, consultant with EY-DKM says:
"The key opportunity now for Limerick is to position as an attractive destination for foreign direct investment in light of Brexit.”