One of Ireland’s leading estate agents has predicted the Dublin second-hand house market is facing a "soft" landing rather than an abrupt crash.
Overall, according to third quarter results published earlier this afternoon by Douglas Newman Good (DNG), there has been a decrease in the cost of second-hand houses in Dublin of 2.8 per cent.
The findings concur with figures released this morning by Sherry Fitzgerald which show the average price of a second-hand properties in Dublin falling by four per cent during the third quarter.
"A number of factors have contributed to the recent decline in prices", Mr Paul Murgatroyd, an economist, with Douglas Newman Good said.
"Firstly, vendors have begun to accept a need to price property at more realistic levels to take account of the changing state of the market.
In addition, past intervention by Government in relation to Stamp Duty thresholds continues to have a negative effect in the market, especially for properties over £500,000 which have seen the largest reductions in price in recent months."
He also pointed to the continuing US-led global economic downturn coupled with the outbreak of foot-and-mouth disease and the domestic high tech slump as factors affecting the market.
Earlier, Ms Marian Finnegan, an economist with the Sherry FitzGerald Group blamed a loss of consumer confidence, fuelled by government intervention and elevated stamp duties for the drop.
However, she also noted that the upper end of the market had been most impacted by the loss in consumer confidence with a notable slowdown in the number of properties transactions, but transactions in the lower to middle end of the market remain relatively robust.
More recently, she said, confidence has been further eroded by fears over a slowdown in the international environment.
Ms Finnegan called on the Government to review the stamp duty rates and to restore mortgage interest relief for investment properties.
"Investors are a necessary ingredient in properly functioning property market. To suggest otherwise is simply foolhardy, given the current pace of rental inflation," she said.
Both reports agreed that reduction in prices will improve affordability, particularly for first time buyers, with the near certainty of further interest rate reductions in the Euro-zone before the end of the year helping underpin the market.