After six or seven years of bullish boom, the property market in the west is beginning to slow down and, accordingly, prices are also on the slide. The trend is more marked in country areas than in a big population centre like Galway city, but a definite buyers' market has developed over the past six months. In Galway city as much as £5,000 is being knocked off homes in the £100,000-plus category, but the market is forcing bigger discounts in the smaller towns and country areas of Connacht. In Ballina, Co Mayo, for instance, a four-bed semi commanding around £90,000 a year ago can now be bought for £70,000.
James Heaslip, in charge of the residential department at Heaslip Auctioneers in Galway, sees the trend as a correction of the kind found regularly in stock exchange trading. "People are standing back and realising that they don't have to panic and rush into buying a house," he says.
"There are plenty of houses available and even though there are more properties on estate agents' books, there is the same number of buyers. It has indeed suddenly become a buyers' market. This is all very good news for buyers. Over the past six or seven years, there were continuing annual increases of 15 to 20 per cent in house prices, but the increase rate is now down to 10 per cent and we can expect that to continue over the next year. I would like to see this more reasonable rate of increase continue."
Like a lot of estate agents, Mr Heaslip believes the "correction" in the house market was inevitable and is convinced it was good thing it happened. "Prices had been going up at an unrealistic rate and if it had kept going, it could only have ended in an explosion," he says.
"What's happened now is that prices have been brought back to more realistic levels. Vendors have become smart enough to realise that things have changed from the way they were 10 years ago. There's no longer a guarantee that they'll get the price they're looking for. But in Galway city, the fall off in prices has not been overly dramatic. A house that might go on the market some years ago for about £145,000, is now being offered for around £140,000."
Mr Heaslip says the slowdown in the property market and consequent dip in prices is more acute in outlying areas around Galway and in the west generally. A lot of houses that have been built in places like Athenry, 15 miles from Galway city, are not being snapped up as they would have been a few years back, regardless of price.
In the rental sector, a big demand for rented accommodation in Galway city continues, fuelled by the presence of a large number of out-of-town students, the financial impossibility for some people to buy a home at current prices, and a considerable influx of asylum seekers.
According to Mr Heaslip, rental costs are much lower in Galway than in Dublin. A two-bedroom apartment in the town centre can be leased for around £600 a month compared with £800 in Dublin. Mr Heaslip's father, Danno Heaslip, a veteran estate dealer, handles commercial property for the business, and reports that there's a surplus of office and warehousing space available in Galway. The demand for commercial property has diminished somewhat even though prices are very reasonable compared with Dublin.
