Wednesday, 19th September 2018
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House prices are expected to continue to rise in 2018 but at a slightly slower pace due to a tightening of the Central Bank lending rules according to the latest house price report from MyHome.ie

The report, which is published in association with Davy, predicts house prices will rise by 8% overall in 2018, split between double digit growth outside the capital and a rise of 6 or 7% in Dublin.

While asking prices fell back by 1% nationally in the final quarter and 0.4% in Dublin– as per normal seasonal trends - 2017 was a year of robust inflation, with prices rising by 10.2% nationally and 11.1% in Dublin.

The median asking price for new sales nationally was €242,000 in the final quarter. In Dublin the median price was €330,000 compared with €195,000 in the rest of Ireland.

Asking prices across Munster showed a broadly consistent picture of a rising market and this was certainly the case in Waterford, where median prices were up 6.9% to €170K. In Waterford city the median price rose by 9% on the year to €120K.

While Q4 is often a relatively quiet quarter in the property market with prices remaining largely unchanged, this was not the case with regard to 3-bed-semis in Waterford. The price of this house type rose by 6.5% in Q4 to €165K and an annual increase of 16% from the €142K recorded a year ago.

While the price of 2-bed-apartments rose by 15% year on year to €69K the price of 4-bed-semis recorded a more modest annual increase of 2.8% to €185K.

The author of the report, Conall MacCoille, Chief Economist at Davy, said the tighter Central Bank rules will serve to slow house price inflation in Dublin.

"Asking prices have fallen in the final quarter of each of the last five years before bouncing back in the Spring and we see that pattern continuing in 2018. However due to the Central Bank tightening its mortgage lending rules we believe house price inflation in more expensive areas, like Dublin, will slow somewhat to around 6 or 7%.

"One of the benefits of rising house prices is a reduction in the number of people in negative equity. Many Irish households have been unwilling to move home due to their stretched finances, specifically their lack of housing equity."

"Looking forward to 2018 rising house prices have now dragged all but 9% of owner-occupiers out of negative equity, a stark improvement from the 36% at end-2012. With greater equity in their homes, more Irish households will seek to move home, helping housing market activity" he said.

The Managing Director of MyHome.ie Angela Keegan said that housing market transactions grew by 10% in 2017 which was a positive development.

"While the increase in transactions – it should come in around 55,000 for 2017 – is welcome the overall picture is that of an illiquid market hindered by the lack of fresh housing supply. If the Irish market was functioning properly we would be seeing around 90,000 transactions per year."

"At the end of the year the number of properties listed for sale had fallen to just 18,900. This is a fresh record low, down 9.4% on the year – representing less than 1% of the housing stock. Not surprisingly the average time to sale agreed was just 3.8 months nationally and 2.8 months in Dublin. These figure show that whatever stock is for sale is sold ever more quickly."

Full details of the report can be found at http://www.myhome.ie/reports

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