2012 was a turning point for the Irish housing market, with Dublin property prices rising for the first time since 2006, according to the latest Sherry FitzGerald barometer.
The estate agency said Dublin prices increased by 1.6%, while prices in the rest of the country were down by 3.3% in 2012, compared to a fall of 16.2% in 2011.
It said results from the fourth quarter of 2012 reveal that the average price of a second-hand property in Dublin rose by 3.3%. This compares with a drop of 3.2% in the same period in 2011.
House prices nationwide rose during Q4 by 1.4%. This compares with a drop of 3.5% in the same period in 2011.
However, when Dublin is excluded from the national figures, there was a decline of 0.7% in the quarter and a decline of 8.6% in the year.
The Cork market saw prices fall by 0.7% during Q4, compared to 3.9pc in the same period in 2011. The annual results for Cork shows price deflation of 9.3%.
Some 82% of the second hand homes transacted in the market through Sherry FitzGerald in 2012 were bought by owner occupiers compared to 86% in 2011. The agency said investors bought 10% of the properties transacted in the year.
Cash buyers purchased 43% of all properties for which a sale was closed in the opening nine months throughout the county.
The agency said first-time buyers accounted for 29% of the properties traded in the year.
As regards vendors, Sherry FitzGerald said 29% of transactions during the year were sales of investment properties. Around 10% of vendors sold with the intention of purchasing a larger property. Executor sales accounted for 21% of the market.
“As 2013 begins, the most notable features of the market are likely to be tight supply of available properties in the cities specifically, Dublin, Cork, and Galway coupled with a growing demand from first time buyers who benefit from a three year exemption from property tax, investors and other owner occupiers,” said Marian Finnegan, chief economist, Sherry FitzGerald.
“This could generate a further uplift in prices in the year ahead.
“In the other locations where supply is not constrained the market should continue on its path to stability.”