Second hand Dublin house prices have increased by €37,500 since June 2012, according to the latest DNG Property Price Gauge.
According to the nationwide estate agency the 7.7% increase since the beginning of the year is being driven by a number of factors including an improvement in confidence, the availability of mortgage finance and limited supply of family homes.
Although all areas of Dublin saw an increase in value with the average price of a home in the capital standing at €279,000, the South of the city performed best with an annual increase of 16.2% followed by the Northside at 16% and the West recording a 10.7% increase. This reflects the fact that the most expensive priced property is located on the south side of city and which rose in value the most in the boom consequently fell the quickest in the crash. The west side, which would have many entry level priced houses, is recovering at a more moderate level of growth.
Although houses in the lower and middle price brackets up to €350,000 performed best in the last quarter with a 4.5% increase, houses in the over €500,000 range showed the biggest annual increase at 18.2%. Houses in the sub €250,000 category recorded the lowest annual increase at 10.7%. This has traditionally been the first time buyer segment of the market, which has been hit hardest and remains constrained by unemployment and emigration.
Mirroring the availability of mortgages cash purchases account for most of the activity in the market. Utilising data from the Irish Banking Federation (IBF) and the Property Price Register, DNG estimates that up to 62% of the 4774 sales in the first three months of the year were cash transactions. This compares with a 47.6% in the same period in 2012.
A further analysis of the Property Price Register shows the average transaction price of an Irish house standing at €191,320 for the period Jan to Apr 2013, with Dublin houses priced at €297,574 and the rest of Ireland at €140,243. In the same period the total value of national housing transactions was up 13% with Monaghan showing a 131% increase in the number of property transactions, the highest of all counties.
Commenting Keith Lowe, CEO, DNG said “2013 appears to be a turning point in the housing market. What has emerged is clearly a two tier market with property located in the greater Dublin area far out performing all other locations. Property prices in the capital are rising by over 1% per month as demand is clearly out stripping supply. It should be pointed out that the price rises are rising from a very low base as they fell so rapidly in the capital. House prices in a number of the most sought after north and south side suburbs have seen stronger gains. The lack of new homes construction in the capital is now putting upward pressure on property prices. We also believe that prices in a number of high population urban areas outside the capital are also beginning to improve somewhat but there are still challenges in some more rural locations where there are local issues such as high unemployment and over supply. These micro areas will not affect the macro situation which appears to be positive.”
Full copy of the report is available on www.dng.ie