Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie
Media: Article - Dublin house prices fall as the rest of the country surges
Options
-
21-12-2015 7:45am#1Join Date:Posts: 30620
http://www.independent.ie/business/personal-finance/property-mortgages/dublin-house-prices-fall-as-rest-of-country-surges-on-34302983.html
Dublin house prices are now falling hard at the same time as regional values surge - the exact opposite experience to one year ago.
The value of an average home in the capital has tumbled over 12 months by 9.3pc in the south county area, by 3pc in the north county, and by almost 6pc in the Dublin City Centre area.
In contrast, areas that experienced the worst price falls have bounced back strongest including Monaghan (up 20pc), Offaly (7.3pc) Kerry (17pc), Donegal (13.8pc), Kilkenny (13.7pc) Cork County (13pc), Wexford (12pc) and Waterford (10.7pc).
The contrasting trends have emerged from the Irish Independent/Real Estate Alliance Average House Price Survey, which shows just how quickly Central Bank lending restrictions in tandem with fast-increasing rents have impacted.
It marks a complete U-turn, as last year Dublin prices had been rising by as much as 20pc while the regions were flagging.
Falling Dublin prices are being blamed largely on the Central Bank's tightened lending regime introduced at the start of this year, impacting harder in the capital where prices are up to twice what they are elsewhere. In tandem, agents are blaming rising rents, which are trapping Dubliners and cutting down their ability to save for vastly increased deposits.
Many are struggling with the 3.5 times income-to-loan ratios.
The average house in Dublin City and County now costs €332,000, down €21,500 (-6.08pc) on last December's price, the Quarter Four REA Average House Price has found.
And while prices in the capital have been hit following large increases in 2014, values in the commuter counties and the larger cities have grown by 4.58pc in the 12-month period, with the average house now costing €206,853.
However, the biggest upsurge this year has been in the rest of the country, where towns have seen growth of 9.31pc, and average prices have risen from €111,518 to €122,161.
Ireland's largest cities have had a strong fourth quarter, with Cork (up 3.64pc), Galway (4.17pc), Limerick (1.29pc) and Waterford (2.84pc) all turning in their best performances since the survey began in 2013.
The average semi-detached house nationally now costs €188,370, a slight rise on the Q3 figure of €186,102.
Prices in Dublin City and County fell by -0.75pc in Q4, while Dublin City alone fell by -0.69pc, the average three-bed semi now costing €357,500. The hardest-falling market in the last three months was in Tallaght in Dublin 24, generally regarded as one of the city's most affordable locations for family homes.
However, the fastest price growth was in the rest of the country outside the commuter belt and larger cities, where house prices increased by 0.95pc in the last three months.
The REA Average House Price Survey concentrates on the sale price of Ireland's typical stock home, the three-bed semi.
But the lack of suitable supply has been a big influence on the property market nationwide, according to REA Chairman Michael O'Connor.
"What we have seen in the past three months are prices only increasing in areas that are offering people the accommodation that they require," he said. "People may want to buy housing, but if suitable properties are not available, they will not buy.
"We are seeing a lack of supply of good quality three-bed semi-detached houses across the country, and a desperate need for new developments.
"In many areas, the properties available in the sub-€220,000 level are either apartments, houses that are too small or need too much investment to bring them up to standard. The market is still stalled at the second-time buyer level, due to the restrictive nature of the Central Bank's deposit lending rules.
"Many potential second-time buyers now only have the option of renting bigger houses and letting out their own, as they are not able to afford the 20pc deposit to be able to purchase.
"There are very few suitable houses to buy at the lower end of the market for first-time buyers because potential second-time buyers have no way to trade upwards."
He pointed out that while Dublin was the first region to recover from the downturn, REA members are now seeing an increase in values in our largest cities outside Dublin a year later.
The cash buyer is still more prevalent in country areas (47pc) than in commuter counties (31pc).8
Comments
-
A "survey" of opinions from estate agents and the often mocked Irish independent v the CSO. Let's not have this debate again0
-
Join Date:Posts: 30620
I'd take the percentages they're quoting with a large grain of salt- however, the gist of the story concurs with what most of us who are familiar with a few markets, are recognising. What I'd really like some sort of a commentary on- is whats happening in the larger towns and cities outside of Dublin- parts of Galway and Cork- give Dublin 4 a run for its money- some of the prices are just scarey........
I'm also curious that there is such a large cohort of cash buyers still present in the market- even if it is declining.
I believe most of the reporting in the Indo is crap of the highest order- Mark Keenean- the author of this piece, aside (they have a few good columnists- however, they remain in the minority).
The CSO figures are all well and good- however, and this is an argument we constantly reheat- their stats are 'normalised' by giving you a 3 month running total- to iron out the peaks and troughs- to reduce the potential for hysteria doubtless.......
What I'd take from the story- the manner in which the 'Dublin' market- has stratified into vastly differing offerings- behaving in wholly different manners. Its not a 'Dublin' market any longer- its a series of markets- with little relationship to one another.........0 -
Yeah, as much as I want this to be true, I'm a bit confused as to what this is based on??
0 -
The_Conductor wrote: »I'd take the percentages they're quoting with a large grain of salt- however, the gist of the story concurs with what most of us who are familiar with a few markets, are recognising. What I'd really like some sort of a commentary on- is whats happening in the larger towns and cities outside of Dublin- parts of Galway and Cork- give Dublin 4 a run for its money- some of the prices are just scarey........
I'm also curious that there is such a large cohort of cash buyers still present in the market- even if it is declining.
I believe most of the reporting in the Indo is crap of the highest order- Mark Keenean- the author of this piece, aside (they have a few good columnists- however, they remain in the minority).
The CSO figures are all well and good- however, and this is an argument we constantly reheat- their stats are 'normalised' by giving you a 3 month running total- to iron out the peaks and troughs- to reduce the potential for hysteria doubtless.......
What I'd take from the story- the manner in which the 'Dublin' market- has stratified into vastly differing offerings- behaving in wholly different manners. Its not a 'Dublin' market any longer- its a series of markets- with little relationship to one another.........
While I take your points I believe people should not be misguided by the attention catching headline which is patently not true. It is also talking about asking prices. The CSO does not report on these.
The "opinions" in this article and report just repeat what we already know. Places where people are on very rigid fixed incomes ie Tallaght have seen falling asking prices. It makes no mention of the more upmarket Dublin postcodes. Increasing asking prices in commuter towns is also a very underwhelming revelation.
To solidify this articles early grave, its released Christmas week. It's just padding out a thin newspaper. Its a nothing story0 -
Any survey of asking prices, let alone one restricted to a specific property type, is essentially meaningless. This survey also tells us nothing useful about the stratification of markets, given that it's entirely stratified itself.
Want to know which way the actual price index has headed - nationally, within Dublin, or outside Dublin? Then you need to refer to the CSO stats.0 -
Advertisement
-
Any survey of asking prices, let alone one restricted to a specific property type, is essentially meaningless. This survey also tells us nothing useful about the stratification of markets, given that it's entirely stratified itself.
Want to know which way the actual price index has headed - nationally, within Dublin, or outside Dublin? Then you need to refer to the CSO stats.
Well the CSO stats are out:
http://www.irishtimes.com/business/economy/property-prices-suffer-biggest-monthly-drop-in-nearly-a-year-1.24760940 -
Join Date:Posts: 30620
stevedublin wrote: »
The other thing is- these CSO stats- are three month average stats- which is supposed to reduce the frequency and volatility associated with monthly stats........ So- a significant drop in November figures- which was not reflected in previous months- bodes ill for December (though Jan may be a different story- time will tell).
In brief- Dublin prices are falling- and the overall annual percentage rise is continuing to fall- we're now looking at a national increase in prices of 6.5% for the year to-date- with the entirety of this increase accounted for by sales outside of Dublin (which are up over 10%).
Interestingly- house prices are also falling in Dublin now- mirroring the falls we saw in apartment prices earlier (though apartment price falls seem to have stabilised somewhat)...........
What a mess.0 -
Join Date:Posts: 13664
The_Conductor wrote: »What I'd take from the story- the manner in which the 'Dublin' market- has stratified into vastly differing offerings- behaving in wholly different manners. Its not a 'Dublin' market any longer- its a series of markets- with little relationship to one another.........
10 years ago, the strategy for young price conscious couples was to buy a gaff in Virginia or Gorey and commute in for a few years, before selling up at a profit and using the large deposit to buy in a closer commuter town, then a suburb, then a nicer suburb etc.
That mentality seemed to have largely dissappeared as people want to rent or buqyw within walking or public transport distance to work.
I wonder have people given up on dublin again as they did in the early 2000s and look to commuter towns?
If so, while there are different markets, there is a point at which people substitute markets.
A puzzling feature if the current "Dublin" market is that there are high yield cheap properties and low yield expensive ones. Using that as a guide, i wouldve thought we might see lower end properties increasing or staying level with more expensive ones going down e.g. one beds in good locations can have 8-9% yields and 4 bed semis in the high demand suburbs havze quite low yields 3-4%.
I guess it means that there are few investors and a few high wealth purchasers have been duking it out over a few upper end properties. So its hard to know who is buying and what!0 -
The_Conductor wrote: »The other thing is- these CSO stats- are three month average stats- which is supposed to reduce the frequency and volatility associated with monthly stats........ So- a significant drop in November figures- which was not reflected in previous months- bodes ill for December (though Jan may be a different story- time will tell).
In brief- Dublin prices are falling- and the overall annual percentage rise is continuing to fall- we're now looking at a national increase in prices of 6.5% for the year to-date- with the entirety of this increase accounted for by sales outside of Dublin (which are up over 10%).
Interestingly- house prices are also falling in Dublin now- mirroring the falls we saw in apartment prices earlier (though apartment price falls seem to have stabilised somewhat)...........
What a mess.
Once again, you've opted to misrepresent the data. Dublin property prices are up on a year ago. The notion that 'the entirety of the increase' is down to sales outside the Dublin area is simply untrue. By end of Jan we'll have clarity on the level of price growth applicable to 2015, but what's been apparent for a number of months now, is that there will be YoY price growth - both nationally, and for Dublin properties.0 -
The_Conductor wrote: »
"We are seeing a lack of supply of good quality three-bed semi-detached houses across the country, and a desperate need for new developments.
This is rubbish! How can a country go from a housing oversupply to a shortage. Whole estates have been knocked down. There are still many empty new builds around.
These lending restrictions are a good thing. Its preventing a house mega boom then crash in Dublin and pushing out people to live all over the country. It will encourage businesses and people to live all over Ireland, not just in the crowded Dublin area. It will also stop prices rising too fast everywhere. Sensible measures but I see many bankers and vested interests who want the cap taken away.0 -
Advertisement
-
Join Date:Posts: 30620
This is rubbish! How can a country go from a housing oversupply to a shortage. Whole estates have been knocked down. There are still many empty new builds around.
The issue with a lot of the oversupply which did exist- and I don't dispute that there was a significant oversupply- is that the oversupply was predominantly in places people didn't want to live in significant numbers (for varying reasons- including poor infrastructure- and the fact that it would have entailed quite unusually large commute times.
We worked through that oversupply by various means- including in some cases demolishing some developments which should not have been granted planning in the first instance. The number of estates demolished was actually a lot lower than it was originally thought we'd have to.
Yes- we do have not insignificant numbers of vacant properties even now- however- most of them are vacant for damn good reasons- in short- because people don't want to live in them (for varying reasons- top of the list being- where they are.........)These lending restrictions are a good thing. Its preventing a house mega boom then crash in Dublin and pushing out people to live all over the country. It will encourage businesses and people to live all over Ireland, not just in the crowded Dublin area. It will also stop prices rising too fast everywhere. Sensible measures but I see many bankers and vested interests who want the cap taken away.
I agree that the lending restrictions were overdue- and they are by and large a good thing. However- I'm agreeing with your end point- rather than how you got there......... The percentage fall in Dublin prices was higher than in the rest of the country- and the percentage recovery in the rest of the country- exceeds the percentage recovery in Dublin.
Yes- the lending restrictions have been a major factor in keeping price rises in check- however, the full impact of the lending restrictions has only really kicked in from August onwards- and outside of Dublin, over 40% of all sales are still cash sales (Dublin cash sales are a lower percentage).
House price rises are being restricted yes- however, I'd argue that the lack of wage increases other than in a few selected industries- has in all probability kept prices reasonably in check- more so than anything else. And those few industries that have seen sustained wage increases- tend to be the sort of industries that have a younger more mobile workforce- who don't necessary want to buy property (keep in mind the statements from Twitter, Ebay and Intel over the past few months- regarding problems they're having finding properties for their staff to rent- and some unusual incentive schemes for current staff to provide temporary accommodation to new starts).
As for encouraging people to live all over Ireland- 'and not just in the crowded Dublin area'- I'd argue that that is wishful thinking. By and large- young and mobile workforces tend to want to live in specific areas- and the availability of cheap accommodation- in itself, is not a sufficient motivation to lure a majority of people to provincial locations. Look at the vast quantities of vacant high spec developments in the border areas in particular- its almost impossible to give them away.......
We have one city of moderate size in an international context- Dublin- and we have a few other areas with very good magnetic draw for large numbers of people- notably Galway and Cork. This is reflected in house prices in those areas- parts of Galway have house prices that would embarrass Dublin based estate agents- and as for Cork- we have an ongoing flow of posters in this forum lamenting the lack of available property.
We have tried all manner of methods to try to encourage the regions over Dublin- most schemes- including the much derided Civil Service decentralisation scheme of McCreevy- have been so bad, that they've been binned and are rarely spoken of. Trying to upsell the regions to potential employers and employees- on the basis of the availability of accommodation- is simply only one cog in the clockwork that has to be working- one item on a check list.
I agree with your ascertain that the deposit rules are a good thing- I don't agree with you why they are a good thing...........0 -
Join Date:Posts: 30620
Once again, you've opted to misrepresent the data. Dublin property prices are up on a year ago. The notion that 'the entirety of the increase' is down to sales outside the Dublin area is simply untrue. By end of Jan we'll have clarity on the level of price growth applicable to 2015, but what's been apparent for a number of months now, is that there will be YoY price growth - both nationally, and for Dublin properties.
Dublin prices- both of houses and apartments- are up on last year. However- they have been in negative territory for quite some time- and are eating into the gains they recorded earlier in the year.
Its unlikely we will loose the 6.5% national price increase in the final month of the year- it is probable that the percentage increase will continue on a downward trajectory though.
January- will be an interesting month- not least because the lenders have a fresh stock of lending exemptions that they can call upon. The have sent away significant numbers of prospective purchasers over the last 8 weeks- advising them to reapply come the new year. Presumably a sizeable number of these deferred purchase/sales will take place in the early part of the year- if the market is thin, as it is- these deferred purchases/sales- could have an outsize impact on the market.
The point I was making about the CSO smoothing of the data- is that it hides peaks and troughs (deliberately). They report a 3 month running average- aka the November figure published in the last few days is the average of September, October and November. The December figure which we'll get towards the end of Jan- will be the average of Oct, Nov, Dec. That is- despite its headline as the November figure- its actually a running average of the preceding 3 months. If there was a one-off factor that causes a jump or a fall in the market- it would be smoothed out. We'll only in fact be clean and clear of 2015 data in the monthly figures- when the March monthly figues are reported towards the end of April 2016..........
I did query this directly- and received the answer that it was a 'normalisation exercise' which removes peaks and troughs that might give an unusual indication as to the health of the sector.
Anyhow- we're not going to see eye to eye, come what may.
Have a good evening.0 -
I believe that Kilkenny and Tipperary were the last two counties in 08 to record asking price drops after the rest of the country had gone into reverse in the two years before.
I can imagine a few cashing out of Dublin and buying within an easy distance to Dublin creating a price rise echo.0 -
The_Conductor wrote: »
I agree with your ascertain that the deposit rules are a good thing- I don't agree with you why they are a good thing...........
Thanks for the interesting and informative reply. We are all here to debate a bit, well I am anyway so I have no problem being corrected or disagreed with. Yes you are probably right in that some of the empty housing was built in the wrong place. However houses are still selling in areas that were considered this, eg Keshcarrighan. There isn't a lot there and the nearest towns are 20 mins drive away along not very good roads. People must be happy to do it though.0 -
The_Conductor wrote: »Dublin prices- both of houses and apartments- are up on last year. However- they have been in negative territory for quite some time- and are eating into the gains they recorded earlier in the year.
Its unlikely we will loose the 6.5% national price increase in the final month of the year- it is probable that the percentage increase will continue on a downward trajectory though.
Dublin prices have not 'been in negative territory for quite some time' as the price growth for YTD will attest to. Some months are positive, some negative, but overall it's been a year of growth. They had gains and losses early in the year, and have had recent gains and losses. In fact the Dublin story has been one of fluctuating prices over the year, with underlying slow growth. It's only when compared to the rapid price rises of last year that this year's growth looks like a poor relation, but it's still growth nonetheless.0 -
Happy to do it or no choice in the matter? Rents are very high and supply in the urban centres is restricted.Thanks for the interesting and informative reply. We are all here to debate a bit, well I am anyway so I have no problem being corrected or disagreed with. Yes you are probably right in that some of the empty housing was built in the wrong place. However houses are still selling in areas that were considered this, eg Keshcarrighan. There isn't a lot there and the nearest towns are 20 mins drive away along not very good roads. People must be happy to do it though.0 -
From the same publication that brought us this pearl of wisdom?
http://www.independent.ie/business/personal-finance/property-mortgages/central-bank-rules-wont-have-effect-on-house-prices-31085023.html0 -
This is rubbish! How can a country go from a housing oversupply to a shortage. Whole estates have been knocked down. There are still many empty new builds around.
These lending restrictions are a good thing. Its preventing a house mega boom then crash in Dublin and pushing out people to live all over the country. It will encourage businesses and people to live all over Ireland, not just in the crowded Dublin area. It will also stop prices rising too fast everywhere. Sensible measures but I see many bankers and vested interests who want the cap taken away.
Pity most of the jobs are located in the capital. :-(0
Advertisement