New confidence in Limerick market

New confidence in Limerick market

 

In 1574 a document prepared for the Spanish Ambassador described Limerick as being “stronger and more beautiful than all the other cities in Ireland”.

Over the centuries the city has been rebuilt many times and some of the finest examples of Georgian architecture in Ireland can be found in the areas of The Crescent and Perys Square.

Yet the highest unemployment levels in the State coupled with low confidence in the property market meant that in recent years transaction levels in Limerick were low.

The good news from data analysed from the Property Price Register is that 2012 saw a 12 per cent increase in transactions from 2011, with the total number rising to 817 from 719 in 2011 an 8.6 per cent increase on 2010.

It is clear from the breakdown of prices that the majority of houses sold in 2012 were in the €0-€250,000 bracket, with 714 of the total 817 falling into this category. There were 92 transactions in the €250,000 to €500,000 range and only 11 transactions above this price.

Des O’Malley of Sherry Fitzgerald O’Malley estate agents says there is a large shortage of stock in all sectors. “People are just not selling but the demand is still the same. Many people are waiting four to five years to find a family home.” He says there may come a time soon when houses will have to be built to fill the growing demand.

Gillian Dunne of DNG Cusack Dunne agrees that there is a dearth of stock especially of four- and five-bed houses in good condition. “Many of the houses coming to the market are repossessed and in need of total renovation, and while the banks have improved volumes of lending, they are only lending the exact price of the house and will not fund renovations. People just don’t have that kind of money saved to carry out renovations.”

Lisa Kearney of Rooney’s agrees. “The types of properties that are actively selling are those in turn-key condition,” she says. “We have returned to the days of the show- house-standard house attracting interest. The house needs to tick all the boxes.”

So why are people reluctant to put their homes up for sale? Angela Keegan, managing director of MyHome.ie cites caution, along with lack of confidence in prices.

“If you look at the high number of job losses in the region, coupled with concerns about the economy in general, many people see it as too risky to put their homes up for sale. Prices have continued to decline in Limerick but thankfully from recent data the pace of decline has slowed down. It is great to see evidence of recovery in terms of the number of transactions.”

Unsurprisingly, Limerick city, with 220 transactions, accounted for more than a quarter of the county’s sales in 2012 at 26.9 per cent, which was up on the 2011 figure of 24.8 per cent but down on 2010 where the figure was 27.7 per cent. This trend was echoed in Newcastle West and Castletroy. Kilmallock and Rathkeale, however, remained unchanged. In the areas of Clareview, Mayorstone and Lansdowne, which despite their close proximity to the much sought after Ennis Rd address, the 1950s-era houses coming on the market are mostly executor sales, so houses are reasonably priced (€130,000- €160,000) for the location but most are in need of an overhaul and again, as with the repossessed houses, the banks just will not finance renovations.

There is a good market for cash buyers spending up to €100,000 with many picking up apartments for €25,000-€45,000 in prime rental areas such as Mount Kennett Place, but according to Dunne there are very few buy-to-live apartments available in the city. Dunne is adamant: “Price your house correctly and it will sell.”

The most expensive house sold in Limerick in 2012 was in the village of Adare. The house sold for €1.78m which was €10m less than the original asking price. The cheapest house sold in 2012 was in the city area of Prospect and sold for €6,500. The property register is a great place to see what houses have achieved in selling terms since 2010 and potential sellers will have a good indication of the market value of their property.

While sales for the year in Limerick were at their highest level in 2012 for the past three years, they did fall back in relation to the rest of Munster. Last year, sales in Limerick accounted for 13.6 per cent of Munster’s 5,990 recorded transactions but this was a drop from 15.1 per cent in 2011 and 14.6 per cent in 2010.

In the three years from 2012 to 2010 there were 2,283 property transactions in Limerick, which was the second highest total in Munster after Cork at 7,007.

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