Embargo 00:01 Monday, March 30th, 2020. The rate of house asking price inflation was showing significant signs of recovery in the run-up to the outbreak of Covid-19, according to the latest house price report from MyHome.ie.
The report, which is published in association with Davy, found that quarterly asking price inflation rose by 1.9% nationally, by 1.5% in Dublin, and by 1.6% elsewhere around the country. Annual asking price inflation was 0.7% nationwide while in Dublin it was flat.
This means the mix-adjusted asking price for new sales nationally is €273,000, while the price in Dublin is €380,000 and elsewhere around the country it is €226,000. Newly listed properties are seen as the most reliable indicator of future price movements.
The author of the report, Conall MacCoille, Chief Economist at Davy, said that indicators of activity suggested the housing market had recorded a decent start to the year. “After activity was depressed by Brexit in 2019, residential property transactions in January were up 6% year-on-year, while agreed sales and mortgage approvals in Q1 were both up 10% annually. Similarly, housing completions rose to 21,124 in 2019, up 18% on the previous year.
However, he noted that Covid-19 and the measures needed to fight it would likely kill off any green shoots we have seen so far this year. “For now, the immediate outlook is an illiquid market with depressed pricing among the very few transactions that do take place. In this context, our forecast for 2% Residential Property Price Index (RPPI) inflation through 2020 now looks optimistic.”
Angela Keegan, Managing Director of MyHome.ie, said that despite the huge uncertainty caused by Covid-19, there were positives to take. “MyHome.ie analysis of the Chinese property market – the first country to be affected by Covid-19 – shows that after an initial hard shock, it has bounced back relatively rapidly. Technological advances also mean that online viewings are now being utilised en masse and have become hugely important for agents, sellers and buyers – perhaps signalling a future trend.”
Full details of the report can be found at www.myhome.ie/reports
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For further information, contact:
Julian Fleming (087-6915147)
Editors’ notes
Central Bank lending rules
The Central Bank of Ireland (CBI) tightened its mortgage lending rules for 2018. Previously up to 20% of new mortgage loans for house purchase were allowed to have a Loan to Income ratio exceeding 3.5 times income. The new rule reduces this allocation; only 10% of trader uppers will now be allowed an LTI ratio over 3.5x. This allocation is left unchanged for first-time buyers at 20%
