House prices nationally are continuing to rise but at a slower rate due to tighter bank lending and “stretched affordability in Dublin”, according to MyHome.ie.
The latest report from The Irish Times-owned property website also points to a pick-up in supply in Dublin, with 20 per cent more properties listed for sale than this time last year. It also finds the number of transactions involving houses worth more than €1 million rose to 826 in 2017, up 25 per cent on 2016.
The report, published in conjunction with Davy Stockbrokers, found house prices nationally rose 9.5 per cent year-on-year in the first quarter of 2018, down from 10.2 per cent in the previous quarter.
The tightening of the Central Bank mortgage lending rules, coupled with stretched affordability, was likely to be first felt in the capital
The slowdown was more marked in Dublin, however, where annual inflation fell to 8.2 per cent, its lowest level in over a year. This was down from 11.1 per cent in the previous quarter.
Outside Dublin, asking prices in early 2018 rose at an even faster pace than last year, up by 10 per cent.
“This is not surprising. The tightening of the Central Bank mortgage lending rules, coupled with stretched affordability, was likely to be first felt in the capital,” said Davy chief economist Conall MacCoille.
He said house price-to-income ratio for first-time buyers in Dublin was 4.1 at end-2017, higher than the 3.5 recorded in Cork, Galway, Limerick and Waterford.
“Overall we expect house price inflation will remain close to 10 per cent outside Dublin but cool toward 5-6 per cent in the capital, averaging out at 8 per cent nationally in 2018,” he said.
Year-on-year
MyHome.ie’s figures contrast with the Residential Property Price Index from the Central Statistics Office, the State’s official barometer, which recorded prices rising 12.5 per cent year-on-year in January.
MyHome.ie’s report noted that the slowdown in inflation in the capital was evident in more expensive areas and property types. It found that the median or middle asking price in Dublin south was flat year-on-year at €275,000, but was up 12.8 per cent in Dublin north to €225,000.
The median cost of a one-bedroom apartment in Dublin, meanwhile, increased 13 per cent over the past 12 months to €190,000 in contrast to the price of a four-bedroom detached house, which was flat at €650,000.
The median asking price for new sales nationally was €260,000, while in Dublin it was €345,000.
The report indicated the number of residential transactions above €1 million rose to 826 in 2017, up 25 per cent on the previous year. “Activity at the very top end of the market shows little sign of slowing down,” Mr MacCoille said, noting there were currently 506 properties with an asking price exceeding €1 million listed for sale on MyHome.ie
Supply
Another significant trend picked up in the report related to the supply of homes for sale.
There were 18,800 properties listed for sale on the website last month. While this was marginally down on last year, the number of properties listed for sale in Dublin, at 3,900, was up 20 per cent. The report also noted the number of new developments on its site had increased to 423, up 24 per cent on the 342 recorded in mid-2017.
The mismatch between supply and demand has long been seen as the main driver of prices in Ireland.
