Irish residential property prices up 1.4% in the year in November

In the year to November, Irish residential property prices (houses and apartments combined) at a national level rose by 1.4%, up from the revised annual increase of 1.0% (+0.9%) posted in October. In Dublin, residential property prices fell by 0.7% in the year in November. Dublin house prices were down 0.5% on an annual basis while apartment prices fell 1.2% in the same period. The highest house price growth in November was in Fingal, at 3.0%. In contrast, Dun Laoghaire-Rathdown showed an annual decline in prices of 6.3%.

Residential property prices in the Rest of Ireland (i.e. excluding Dublin) were 3.6% higher in the year to November. House prices in the Rest of Ireland also rose 3.6% over the period. The Border region showed the greatest price growth, with house prices increasing 9.9%. Conversely, the Mid-East region saw an increase of just 0.4% in the year. Apartment prices in the Rest of Ireland increased 3.9% in the same period.

Overall, the national index is still 16.8% lower than its highest level in 2007. Dublin residential property prices are 21.3% lower than their February 2007 peak, while residential property prices in the Rest of Ireland are 19.9% lower than their May 2007 peak.

From the trough in early 2013, prices nationally have increased by 85.7%. Dublin residential property prices have risen 94.9% from their February 2012 low, while residential properties in the Rest of Ireland index have increased 84.3% from their lowest point, which was in May 2013. 

Lack of supply remains the key issue for the Irish housing market. First-time buyers continue to be priced out of the market. Subsidising purchasers through tax breaks is not the answer. But at least, new supply is coming on stream.  

The most recent figures from the CSO showed that new dwellings completed totalled 14,764 in the first three-quarters of 2019, an increase of 18.0% on the total of 12,510 in the same period in 2018. In full year 2018, a total of 17,995 new dwellings were completed and this is forecast to rise to around 22,000 for the whole of 2019 and to 27,000 in 2020.

As such, it is a case of trying to be patient. There is now clear evidence that house price growth has fallen sharply in recent months, especially in Dublin. And in some areas, prices are now actually lower on an annual basis.

An easing of “hard Brexit” fears may see prices recover somewhat in 2020, but overall growth is likely to remain fairly muted in my view, with the biggest price rises coming from outside the capital.