House prices in parts of Ireland are increasing at a rate not seen the Celtic Tiger era, according to a new study.
The Institute of Professional Auctioneers and Valuers (IPAV) said a chronic supply shortage, high rents and low fixed-rate mortgages as well as an increased interest in remote working were driving the spike which could “have deeply damaging consequences” in the long term.
The data suggests that house prices increased nationally by 6.25 per cent in the first half of this year, with a year-on-year increase of in excess of 12 per cent likely if the current trend continues
The survey charts house prices actually achieved, rather than asking prices and reports that the asking and achieved prices “are diverging to a considerable degree” with some properties selling for substantially above their asking prices.
According to the data, the property market comprising two-bedroom apartments and three- and four-bedroom semi-detached homes will increase by at least 10 per cent in 2021, while other one-off houses are likely to increase by a lot more.
The report points to a “very resilient” market and says if demand continues to outweigh supply and interest rates remain low, prices are likely to keep climbing. It says more new properties will have to be built and much of the vacant stock of about 100,000 homes will have to be brought back into the market.
The survey shows double-digit growth for three-bedroom homes in Waterford and Limerick with Tipperary, Meath, Louth and Cavan close behind, with 9 per cent and more growth. Price increases of in excess of 8 per cent were recorded in Co Dublin as well as Dublin 15, Dublin 7, Carlow and Kildare.
Average prices for three-bedroom semis nationally rose by 6.6 per cent but as many as 23 of the 38 markets surveyed showed increases above that level.
The report can be read in full here.
