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House prices rising amid ongoing supply shortage –

By September 29, 2023No Comments

Demand for property is holding up, despite interest rate increases, and an ongoing supply shortage is supporting prices, the latest House Price Report from property listings website suggests.

The report captured a 1.1% increase in asking prices for properties in the three months to September compared to the prior three month period.

In the third quarter of the year, the typical listed price nationwide for a property was €322,602, up 3.7% on the same time a year ago and roughly 13% below the Celtic Tiger peak, according to the figures.

The official figures on property prices from the Central Statistics Office showed prices nationally rising by 1.5% in the year to July, the slowest annual rate of price growth in almost three years.

It captured prices in the capital continuing to fall on an annual basis, but month on month, Dublin prices increased for the second month in a row in July.

As the report is based on asking prices for properties, it can act as a leading indicator for the market.

It recorded prices in Dublin rising by 1.4% in the year to the third quarter suggesting some renewed stability in the market in the capital.

However, it was the lowest rate of inflation captured in this series since prices started to rebound in late 2020.

Prices in Cork city were just 1.7% higher, year-on-year, while in Galway, Limerick and Waterford cities, the rate of annual increase was higher, at between 3.9% and 4.7%.

Outside the main cities, inflation was typically greater, with year-on-year increases of 4% in Leinster, almost 6% in Munster and just over 8% in Connacht-Ulster.

However, supply continues to present a challenge to the market with availability down by a fifth.

The number of homes available to buy nationwide on September 1 stood at just under 12,200, compared to the almost 15,500 available to buy on the same date a year previously.

It remains well below the 2019 average of 24,200.

“The availability of homes is down over 20% year-on-year, at levels of availability only previously seen during the pandemic,” report author Ronan Lyons, economist at Trinity College Dublin, said.

“While the flow of properties coming on to the market has fallen, it is down only slightly comparing the last year with the previous 12 month period. With supply only down slightly but availability down a lot, demand is holding up far better than might have been expected given the rise in interest rates,” he added.

Mr Lyons said around 30,000 houses were expected to be built this year, roughly corresponding to last year’s total.

“In the sales segment, the second-hand market remains very tight,” he said.

“This came about originally because of the pandemic but the market has never fully recovered. With interest rates outside of the control of local policymakers, the other solution is to continue to increase the rate of completions,” he added.

Article Source: House prices rising amid ongoing supply shortage – – Brian Finn – RTE

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