THREE-BEDROOM HOMES in the cheapest parts of Ireland are going for less than one-sixth of the price for similar properties in Dublin.
But the huge gap in housing prices between the capital and many other cities and towns across the country is starting to shrink.
The latest Daft.ie housing report, released today, showed the average asking price for properties rose 4.6% nationwide over the first three months of this year.
In Dublin the increase was only 2.9%, while elsewhere it was 5.9% for the same period. In Cork the rise was 7.2%, while asking prices in Galway and Limerick went up 6.8% and 6.7% respectively.
The average advertised price nationwide is now €201,000, compared to a low of €170,000 in mid-2013 and a peak of €378,000 in mid-2007.
Here’s how those prices have changed across the country since the first quarter of 2014:
Reversing the trend
The report comes after the latest Central Statistics Office figures, based on all sales that were backed by mortgages, revealed property prices actually fell on average during both January and February. Average asking prices also fell over the last three months of last year.
Housing report author and TCD economist Ronan Lyons told TheJournal.ie the Central Bank’s new mortgage rules seemed to have slowed the trend in rising prices for Dublin, but that wasn’t the case outside the capital where the restrictions had little impact for first-time buyers.
The lending rules capped the maximum amount most people could borrow at 80% of a property’s purchase price, or 90% for first homebuyers on sales up to €220,000.
If you look over the past three, four or five years, Dublin has outperformed the rest of country in terms of the change in price – either in the early years the fall was smaller, or in the last couple of years the rise has been bigger. This is the first time we have seen the complete opposite,” Lyons said.
However the Daft.ie figures also demonstrated the huge differential that remained in prices between Ireland’s cheapest and most-expensive regions.
The average asking price for a three-bedroom, semi-detached house in Co Leitrim was €55,000 – compared to €459,000 in south Co Dublin.
The six most-expensive areas for buying similar homes were in and around the capital, while Roscommon and Laois were the next-cheapest areas after Leitrim.
‘Incomes don’t vary that much’
Lyons said it was probably the Central Bank’s rule to limit borrowing at 3.5 times people’s annual incomes that was now having the most influence over prices.
“If you think about the most-expensive versus the cheapest areas where you buy a three-bed, semi-d, there’s probably a variation of 10 to 1 (in prices) … but incomes don’t vary that much, probably only 50% if you take the same type of jobs around the country,” he said.
Here’s what else Lyons had to say about that and the outlook for the property market going forward:
Video by Michelle Hennessy
Note: Journal Media Ltd has shareholders in common with Daft.ie publisher Distilled Media Group.
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