Property Pad

1st October 2014

“Irish house prices rise by over 17% in the twelve months to end September 2014”

By Sherry Fitz.

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Statement by Marian Finnegan, Chief Economist, Sherry FitzGerald Group Sherry FitzGerald House Price Index Wednesday, Oct 1st 2014

Wednesday, October 1, 2014

Key findings;

  • The average value of residential property in Ireland rose by 3.8% in the third quarter of 2014; this brings the growth in the year to date to 14.0%, with growth of 17.2% in the twelve months to September 2014. 
  • Dublin house prices rose by 3.5% in the third quarter of the year, this brings the growth in the year to date to 16.6% and growth of 21.4% in the twelve months to September 2014. 
  • Notably, when Dublin is excluded from the national figure, the quarterly growth figure was 4.3%. Residential property outside Dublin was up 11.7% in the twelve months to end September 2014.
  • The regional centres also experienced upward price movement during the nine month period, most notably in Cork with price inflation of 14.3 % in the nine months and 15.7% in the twelve months to end September.
  • An analysis of the stock of available property for sale shows that supply levels remain very low. There were approximately 37,465 units advertised for sale in July 2014, of which, 4,174 were located in Dublin. This represents a reduction of 19% on July 2013 levels when there were 46,203 units for sale in the open Irish market.
  • Notably, just 0.9% of the Dublin private housing market is currently available for sale. This compares favourably to the 0.6% of stock advertised for sale in Dublin in January 2014.
  • Owner occupation still dominates the purchaser profile at 79%, while investors now account for 15% of all purchasers in the opening nine months.
  • First time buyers remain an active cohort in the market accounting for 21% of the properties traded in the year; notably this compares to 19% in the same period in 2013.
  • An analysis of the profile of vendors who sold their property through Sherry FitzGerald in the opening nine months of the year revealed that 30% of vendors were selling investment properties, while executor sales accounted for 14% of the market.

Commenting on these results, Marian Finnegan, Chief Economist, Sherry FitzGerald Group said;

The strengthening price performance which became evident over the opening half of 2014, persisted during the third quarter, with prices rising by 3.8% in the three months to end September. This compares to 2.5% in the same three month period in 2013. The most significant driver of this price performance was the reduction in the quantity of property available for sale with 19% less property advertised for sale in the summer of 2014 compared to the summer of 2013.

That said, the level of price inflation in Dublin did moderate during the three months to end September, when compared to the previous six month period. While prices rose by 3.5% in the third quarter of the year, this compares to an average growth of 2% per month in the opening six months of the year. This moderation in price growth reflects an increase of over 38% in the quantity of property advertised for sale in Dublin in July compared to January 2014.

Looking to the remainder of the year, it now seems likely that price inflation will approach 20% in the Irish market in 2014 led by the Dublin and Cork markets in particular. Current indicators would suggest that 40,000 properties will transact in the calendar year. This compares to just under 30,000 in 2013 and just over 25,000 in 2012. Without a significant increase in supply, there is now every likelihood that price inflation will remain in double digit figures in 2015.

For any further information, please contact;  

Jill O’Neill 
Director of Communication 
Sherry FitzGerald Group 
Ph: 086 252 3277

Marian Finnegan
Chief Economist
Sherry FitzGerald Group
Ph: 01 237 6341 / 086-814-8251

                                                                                      

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