Asking prices for properties nationally rose by 4.1 per cent in 2023 as the low volume of properties for sale and a buoyant labour market fuelled price inflation, according to the latest quarterly report from MyHome.ie in association with Bank of Ireland.
Annual asking price inflation was 4 per cent in Dublin and 3.9 per cent outside of Dublin, the report found.
The outcome for the full year was in marked contrast to the pattern seen in the first six months when rising interest rates forced sellers to adjust valuations and reduce expectations for the prices they might receive.
Selling prices were also pulling ahead of asking prices by a greater percentage at the end of the year than they were at the start.
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In the fourth quarter asking prices rose by just 0.2 per cent on a quarterly basis in Dublin but fell by 0.4 per cent nationally and by 1.2 per cent outside the capital. This decline was similar to that recorded in the same quarter last year and reflects the quieter winter months, according to the property company, which is owned by The Irish Times.
Nationally the median asking price now stands at €325,000, with this figure rising to €415,000 in Dublin and coming in at €280,000 outside Dublin.
In December houses were being sold for 4 per cent over asking prices, up from 1 per cent at the start of the year, with the shift reflecting “a more competitive market as demand outpaces supply”, MyHome.ie said.
Just 1.4 per cent of properties listed on the site cut their price in the fourth quarter – the lowest proportion of price cuts for the final quarter of the year since the company began collecting data in 2011.
“If asking prices were under pressure at the start of the year as the market adapted to a new interest rate environment, the picture at year-end was very different,” said Bank of Ireland chief economist Conall MacCoille, the author of the report.
“As for next year, our view is that the most likely outcome is another single-digit rise in house prices over the course of the year. There will again be competing pressures on prices coming from elevated rates of interest on the one hand and continuing supply shortages on the other. If anything the rise may be sharper given the supply issues and the possibility – despite mixed signals from policymakers – of interest rate reductions happening at some point during the year.”
Joanne Geary, managing director of MyHome.ie, said more needed to be done to increase supply, which she described as “a real crisis issue for the market” in 2024 and beyond.
At the end of the third quarter of last year some 13,400 homes were listed on MyHome.ie, down from about 20,000 in pre-Covid times. At the end of the fourth quarter this had dropped again to just 11,400.
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