A new report has found that the highly-publicised recovery in the Dublin residential property market is “fragile and localised” with less than a quarter of areas in the capital leading the revival.
What will surprise many within the industry, though, is which areas have shown growth.
The Dublin Property Insight 2014 report is based on a study of more than 28,000 Property Price Register transactions between January 2010 and the end of 2013. Compiled by Locus Insights, the report found that just 21 of the 88 suburbs analysed displayed rising prices during that time frame. This area makes up 91 per cent of all properties in Dublin as per the 2011 Census.
Of the 21 areas to record an increase in their median price from 2010 to 2013, Sutton was named the top performing neighbourhood having recorded a 22per cent increase in the four-year period. All the other top performing areas were concentrated to the south and east of the city. The areas experiencing the greatest fall in prices were in the south-western and outlying northern suburbs, with Coolock and Darndale, Finglas and Ballymun worst affected.
Interestingly, a number of high value southern suburbs also recorded a lack of sustained price growth.
“People think that the high value areas are the ones showing increases but that’s not actually the case,” said Tom Hobson of Locus Insights.
“The most extreme example is Rathmines and Portobello, which recorded a drop in median price in each of the five quarters to the end of 2013, a fall of 24 per cent in total.
“Sandycove also suffered a drop of 26 per cent in 2013 and was still 30 per cent below 2010 levels and that may be indicative of an ongoing adjustment from the hyper-inflated price levels prevailing in these areas prior to 2010.
“It just shows that while there is some recovery, it is highly localised and in some areas there is no recovery at all,” he said.
The study uses median figures, whereby it determines the mid-point value of the number of transactions in an area as opposed to the average, which can be skewed by one-off low or high sales figures.
Hobson said this helped to give the clearest indicator yet of the true state of the Dublin market due to its micro level analysis.
“The report most frequently referenced when talking about the market is the CSO report but it is only based on mortgage transactions so it doesn’t give a true picture of things. Any other reports only look at aggregates but this is the first time that there has been a micro level analysis suburb by suburb,” he said.
“While 69 of the 88 suburbs we looked at recorded an increase last year, only 21 of them were back to their 2010 levels while a consistent positive trend was only apparent in 15 districts where prices have risen steadily for at least the last four consecutive quarters.
“Similarly to how you would look at the economy, you are only out of a recession when you have risen for three of the last four quarters and I feel it should be the same in the housing market where you need to see a consistent rise to call the end,” said the Sligo-based researcher.