House prices rocket by as much as 30pc in rural areas - Ireland
10-21-2014
Mark Keenan
Counties which have not seen any growth since the boom are now experiencing a sharp rise in prices for three-bed semi-detached homes
Property prices outside of Dublin are surging faster than the capital for the first time in years with rural areas recording gains of up to 30pc this year.
Counties which have not seen any growth since the boom are now experiencing a sharp rise in prices for three-bed semi-detached homes.
Many counties saw price hikes of more than 20pc for these family homes as the rest of the country belatedly springs back from years of stagnation.
In Cavan, the price increase was a startling 30pc.
Thousands of families are now being lifted out of the negative equity which has dogged the market and made it almost impossible to move home.
The average price of a three-bed semi is now €179,981 nationally, an increase of €26,925 this year.
The figure rose by almost €10,000 since the end of June alone.
In Dublin city, the average three-bed semi has risen by €27,500 over the past three months to €375,833.
But in percentage terms the biggest increases this year were experienced in Cavan (30pc), Cork City (28.2pc), and Westmeath (27.7pc) according to the Average House Price Index which is compiled by the Real Estate Alliance.
Laois, Longford and Leitrim all recorded gains of 25pc while Galway County and Wexford were up at least 20pc.
Dublin has seen huge price rises in the past two years due to a shortage of suitable homes combined with pent-up demand.
But in this case the capital lagged behind - prices rose in South Dublin by 19pc and in North Dublin by 15.2pc.
The average price across Irish towns and cities rose by 17.59pc during the first nine months of 2014.
And over the 12-month period to September, three-bed semis have seen a rise of 21.59pc across the country, while prices in Dublin city rose by 24.24pc over the same period of time.
Although Dublin prices continued to rise sharply, agents have recently noticed a cooling off in the capital where supply has been increasing somewhat.
"Prices are continuing to rise at a pace in Dublin, but our agents are reporting that the panic buying seems have gone out of the market, with less people at viewings and houses taking a week longer on average to sell," said REA chief executive Philip Farrell.
It means that price increases in the commuter areas around Dublin are now outstripping those in the capital, as first-time buyers chase bargains priced at almost half of those in the metropolitan area.
The fastest rising suburb in Dublin has been Tallaght in Dublin 24, where the cost of an average semi has increased by 37.5pc in just nine months.
It is a sign of desperate home hunters in the capital scouring one of the few remaining areas where semis are still affordable.
But the capital's market shows no signs of dropping off, with prices increasing by almost 8pc in the past three months, after rising by 12pc in the first half of the year.
The average three-bed in the capital started off the year at €311,667 and now costs €375,833 - a significant price leap.
Both South Dublin and Lucan recorded rises of 15.38pc over the past three months alone, with houses in the west of Dublin rising by €40,000 to €300,000.
Meanwhile, the slowest areas to recover across the entire country include Waterford, Limerick Kerry, Tipperary and Monaghan where price rises hit a much more modest 5pc or so over nine months.
However, no counties are now experiencing stagnant or falling prices.
"The three-tier market that REA surveys have identified is still continuing, with the commuter areas out side Dublin, and larger urban areas such as Galway and Cork growing at twice the rate in the first nine months than the rest of the country," said Mr Farrell.
The average property is now taking seven weeks to sell nationwide on average, 41pc quicker than six months ago.
However, Dublin has also seen an increase in time taken to sell, with houses now taking five weeks on average to close, up from four in June.
"Our agents are reporting that there are more private houses now for sale," said Mr Farrell.
Choice
"This is giving the discerning purchaser a better choice and as a result there is not the same amount of bidders as there were in the first six months of the year."
There has been a sharp rise in the amount of private homes for sale nationally, with the percentage of distressed properties on the market dropping for the first time in the life of the survey.
Just 37pc of properties on the market are now considered distressed, down from a yearly high of 45pc in June.
There is further evidence that the banks are financing house buyers to a greater extent with the amount of cash transactions dropping from an average of 66pc in December 2013 to 50pc in September 2014.
"We have seen a marked increase in mortgage transactions in Dublin to 56pc of all sales, with 62pc of sales in the commuter areas being financed by the banks," added Mr Farrell.
"We are also seeing investors being influenced by the end of December deadline for obtaining capital gains tax relief over the next seven years.
"However, we feel that the recent proposals on mortgage finance announced by the Central Bank could have a direct impact on the market from January 2015."
The Real Estate Alliance is a 50 member-strong company network with estate agencies in every Irish county.