Irish house prices rise 8.9% in first three months of 2023

A decline in the number of houses changing hands in the first three months of the year failed to arrest a steep rise in sales prices as the median price for a house for a home in Ireland climbed to €305,000 in the first quarter, analysis of the Property Price Register (PPR) has revealed.

This represents an 8.9 per cent increase in the median sales price in the first quarter of 2023 compared with the same period in 2022, according to a new report from property tech start-up Geowox.

On Thursday, Geowox said that a total of 12,588 units were sold between January and the end of April, a 3.6 per cent slide in the volume of completed transactions for new and existing homes from the first quarter of 2022.

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It also represents a drop from the fourth quarter of last year when 16,881 residential units were sold, likely due to the usual slowdown in market activity during the winter months.

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However, the slide in transaction volumes did not translate into a decline in prices, Geowox said. The national median price for a home in the first quarter was €305,000, up 8.9 per cent or €25,000 on the three-month stretch in 2022 although the annual rate of house price inflation was down from 9.6 per cent in the fourth quarter of 2022.

Dublin, the county with the most sales at 3,857, remained the most expensive county with the median price of a home sold in the first quarter up 8.1 per cent year-on-year and 1.2 per cent quarter-on-quarter.

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At the same time, however, the number of transactions declined by 2.5 per cent from the first quarter of 2022 and 23 per cent from the final three months of last year.

House prices increased year-on-year in every county except Waterford, Geowox said, where the median price of a home sold fell 1.8 per cent to €220,000. Longford, meanwhile, saw the largest increase in prices over the year to the end of April at 23.7 per cent while Roscommon was the least expensive county with the median house price reaching €149,000, 51 per cent below the national median.

The figures are based on sales data rather than asking prices, which means they are subject to revision because the reporting of a sale to the PPR can lag behind the transaction itself. But the figures broadly tally with Central Statistics Office (CSO) data indicating that although house prices are still inclining, the rate of house price growth has retreated in recent months.

Rising European Central Bank interest rates, which translate into higher borrowing costs for prospective mortgage holders, is likely to have dampened mortgage demand. The Banking and Payments Federation of Ireland reported in March that 3,378 mortgages were approved in the previous month, down 8.6 per cent on the previous month and 13.3 per cent on the same month last year while the value of approvals fell 7 per cent.

The impact of higher rates is expected to continue to put downward pressure on transaction volumes on prices in 2023 although the property industry expects prices to remain elevated amid long-standing issues around supply.