Dublin house prices now falling by 1.6% as coronavirus infects market

Dublin property prices fell by 1.6 per cent in the year to August as Covid-19 effectively put the brakes on the market.

The latest Residential Property Price Index from the CSO also points to a 40 per cent drop in the number of transactions in August compared with the same month last year.

The figures show prices across the State decreased by 0.6 per cent year on year in August.

The slowdown in price growth and transactions reflects the impact of the lockdown in April and May, which curbed consumer activity and construction.

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The highest house price growth in Dublin was in Fingal at 1.7 per cent, while Dublin city saw a decline of 3.4 per cent.

The region outside Dublin that saw the largest rise in prices was the southwest at 5.2 per cent. At the other end of the scale, the Border region saw a 2.7 per cent decline.

The figures show there were 2,359 household dwelling purchases filed with Revenue in August. This represented a 40.2 per cent decline on the same month last year.

Median price

Existing dwellings accounted for 79 per cent of the transactions. The typical cost, or median price paid for a home in the Republic was €258,500.

The Dublin region had the highest median price (€375,000) in the year to August. Within the Dublin region, Dún Laoghaire-Rathdown had the highest median price (€530,000), while South Dublin had the lowest (€347,000).

The highest median prices outside Dublin were in Wicklow (€335,000) and Kildare (€307,500), while the lowest, of €108,000, was in Leitrim.

Overall, the national price index is 17.6 per cent lower than its highest level in 2007, while Dublin residential prices are 22.6 per cent lower than their February 2007 peak.

“While activity has ramped up as the industry has adapted amid the pandemic, the lack of supply of properties is an issue, along with affordability and with lenders acting in a severe risk averse way,” said Pat Davitt of IPAV, the Institute of Professional Auctioneers and Valuers.

He said new homes priced between €250,000 and €300,000 are already too expensive for young people on an average wage of €40,000-€50,000.

“Much will now depend on the success or otherwise of the Government’s budget measures. Supply needs to be ramped up and affordability improved,” he said.

Mr Davitt said it was disappointing that the Help-to-Buy scheme was not extended in Tuesday’s budget to include second hand homes.

Robust market

Joey Sheahan, head of credit at MyMortgages.ie said the latest figures “ speak to a robust property market”, suggesting measure announced in the budget would only strengthen it.

“The extension of the Help-to-Buy was necessary and will generate even more activity in the market in the months and year ahead,” he said.

“ The announcement also brings a degree of certainty that was lacking the market – would be first-time buyers were unsure as to whether they would or could make the December deadline,” he said.