PROPERTY PRICES continued to decline last month, showing the biggest monthly fall in more than two years.
New data from the Central Statistics Office revealed the average price for residential property declined by 2.2 per cent in October, and dropped by an average of 15.1 per cent over the year.
The pace of decline has accelerated from September, when a fall of 14.3 per cent was recorded.
Home prices in Dublin have been more severely affected, falling by 3.1 per cent last month and 17.5 per cent over the year. House prices in the capital dipped by 3.2 per cent in the month, while apartment prices were 2.3 per cent lower. Over the year, house prices declined 17.1 per cent, while apartments were 21.2 per cent lower compared with the same period in 2010.
The rest of the country saw an overall fall in residential property prices of 2 per cent in October, and 13.8 per cent over the year.
Property prices have now fallen 45 per cent since their peak in early 2007. A recent survey of economists by Reuters predicted that house prices would continue to decline for some time, with a 6 per cent fall in 2012.
“Even allowing for the new initiative by Nama to offer a limited amount of mortgages with protection against price falls, as well as lower interest rates from the European Central Bank, the short-term risks to house prices remain to the downside in our view,” Bloxham economist Alan McQuaid said yesterday. He predicted a fall of about 14 per cent for 2011, with a 9 per cent decline next year before prices start to pick up in 2013.
“Dublin house prices are likely to lead the recovery when it does come given that the capital has the biggest concentration of people. But, the reality is that Ireland’s banks, recently faced with a fresh €24 billion bill to bolster their balance sheets, are currently focused on raising capital and selling assets rather than expanding their mortgage books,” he said.
