Dunfanaghy is booming.
Even on a grey August afternoon it is full of holidaymakers piling out of cars laden with surfboards and bicycles, filling the craft shops and cafes, and examining the properties for sale in the estate agent’s window.
"I've noticed the prices going up," says Paddy McAnallen from Lurgan, Co Armagh.
“A three-bedroom house that would have been €250,000 or €260,000 would now be €300,000.
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“There aren’t as many properties available, and anything that comes on the market is snapped up very quickly.”
He is on a mission – to find a property for his sister, who is looking for a holiday home. They have been holidaying here for 35 years: “When we first came here it was a ghost town, but now there’s a good buzz about the village. It’s very upmarket,” says McAnallen.
“It’s a place where the rich Northerners come – and me,” he laughs.
According to the Central Statistics Office (CSO), residential property prices rose nationally by just under 7 per cent in the year to June; the highest increase was in Border counties, where they went up by 13.9 per cent.
This has been even greater in coastal areas such as Dunfanaghy, in north Donegal, which have experienced a surge in house prices as a consequence of the Covid-19 pandemic as people – either originally from the area or relocating for the first time – take advantage of the possibilities offered by remote working.
A June report for property website Daft.ie showed properties by the coast are now 23 per cent more expensive than they were before the pandemic, compared with a national average of 8.7 per cent.
The growth in transaction prices was even greater, “with approximately one-fifth of coastal properties going for more than 10 per cent of the asking price, approximately double the national ratio”, the website found. In Dunfanaghy, the disparity between asking and transaction price was 26.3 per cent.
Those who already own property in the village have watched its value increase. One woman who bought in 2018 described how her home has grown in value by €100,000; another example is a young couple who sold a property after less than two years for double the price they paid for it.
Yet others who live and work in the local area have watched as the prospect of owning their own home becomes more and more remote.
Tara Alcorn moved back home to Dunfanaghy with her Brazilian husband, Anderson Rodrigues da Silva, in May 2020; they opened their own business, Casa cafe and deli, earlier this year.
They had been living in an apartment in Edinburgh, and lockdown in a big city helped persuade them to make the move; when they returned, Alcorn saw a "huge difference" in the village.
“There are more people moving to Dunfanaghy who aren’t 60 plus. Younger couples are moving here to live, and the surfing ... now people are more outdoorsy, and I think that maybe is from the pandemic, they are using what they have on their doorstep more.”
Rental market
They are “lucky” as they are living in a house owned by Alcorn’s relative; “I know several people who have tried to rent in Dunfanaghy and they can’t.”
Da Silva says: “One of my friends came here, he was in a small house for two months until May, and the lady said he needed to move because [she was going to rent it on] Airbnb and probably get more money.”
“We know one guy who has moved five times in a year because it’s all short lets,” adds Alcorn. “I don’t blame the people who have an Airbnb; if you can make that in the summer, then why not?”
As for a house of their own, “We look but we just look for the craic, to be honest, because there’s no way we could afford it now.”
Estate agent Boyd Robinson of Robinson Estate Agents – which has offices in Dunfanaghy and Letterkenny – has seen the number of inquiries double since lockdown.
About half are from people in Donegal, with the others mainly from Ireland, and some from England. "They're coming to live and work remotely and they want to be near the beaches because they've been in the city for so long," says Robinson.
“Any instructions that we get certainly in the Dunfanaghy area are usually sold within a month – that compares with probably four or five months previously.”
Price increases are driven by “plain and simple supply and demand”; people who had been considering buying a holiday home have been spurred on to purchase by the pandemic, while those who already have holiday homes are keeping them “because they’re getting use out of them because they’re not going away, so you’re getting a supply problem to the market as well”.
“A semi detached house that would have passed hands maybe three years ago in and around the €125,000, €135,000 mark, are now fetching up to €190,000, €200,000.”
Time to sell
At the Art House Gallery on the Main Street, there is a for sale sign on the wall. Artist Brian O’Doherty explains he has been here for 10 years, but his landlord is selling up. “Prices have gone up locally... it’s an opportune time to sell.
“Talking to other artists, they’ve seen the same thing. They’re saying a lot of Dubliners are buying up property down the west coast.
“Local families have older kids living at home, they can’t afford to move out. It’s very difficult.”
He points out his recent Tripadvisor award, his fourth in a row. “Last year was a bumper year, with staycationers” but the loss of his premises “has been a bit of a body blow”. Asked what he will do, he replies: “I don’t know.”
Sisters Emma and Deborah Moore set up Muck 'n' Muffins – a pottery studio, gift shop and cafe – in what was a derelict former grain store in the centre of the village 21 years ago.
From Dunfanaghy, they outline the changes they have seen in the village, not least the number of people who have relocated to the area because they can now work from home.
There is “no way” they could afford to set up such a business now. “You’d need a really good job,” says Deborah. “You wouldn’t be making pottery,” adds Emma.
“House prices have just become disproportionately stupid. People are moving out of houses and renting them out for the summer for silly money and moving in with their parents.”
Originally from North Yorkshire, Harriet Henderson moved to Dunfanaghy in June 2020 to work at a surf school and shop; her family has been holidaying here for 30 years "so I knew how amazing it was" and she is able to live in her parents' holiday home.
“I’m lucky, property isn’t something I had to look into. It’s really difficult for people trying to live here, not just be on holiday here.”
Like everywhere in Dunfanaghy this summer, Arnold's Hotel is also busy. Aisling Arnold moved home pre-Covid to help run the business – the fourth generation of her family to do so – and she has witnessed how the village has grown in popularity over the years
“There are an awful lot of people looking to move to Dunfanaghy. It’s a cool place to be now.”
