THE LATEST DATA from the Central Statistics Office (CSO) has revealed house prices have increased by 1.4% nationwide in the last 12 months since September.

Outside of Dublin, prices are up by 4% in the last year while prices inside Dublin have seen a three-month trend of decreases, falling by 1.9% as of September the Residential Property Price Index found.

The government has been warned that if it doesn’t meet its housing supply targets, these upward trends may continue, with one expert suggested they will spiral.

Trevor Grant, Chairperson of the Irish Mortgage Advisors has warned the government that price “may start to spiral upwards” if the state’s supply targets aren’t met as there is a “heightened level of activity in the mortgage market”.

Grant attributes these increases to the heightened activity, and suggests that schemes under the Housing For All strategy has led to an increase in demand.

Grant said: “First-time buyers currently account for approximately 80% of home mortgage drawdowns on new properties and 69% of second-hand properties in Q3 2022.

First-time buyers still play a major role in the market, making up 60.4% in terms of quantity and 14.9% in terms of value.”

“This suggests that those entering the property market for the first time make up a significant proportion of the demand,” he added.

Despite the increases in prices, and the risk that they will continue, Grant says it is still cheaper to buy than rent over a long-term period, as outlined by analysis from MoneySherpa on Monday.

This warning comes after the government yesterday outlined it will broaden the Local Authority Home Loan scheme to allow prospective purchasers to receive funding to renovate derelict or non-habitable properties for the first time.

Previous extensions, such as the extension to the First Home and Help to Buy scheme to lenders seeking to buy second-hand homes, were critiqued by housing expert Rory Hearne and Sinn Féin’s spokesperson for housing Eoin Ó Broin for the impact it could have on further inflating prices in the private market.

The government yesterday said it was “confident” it would reach its targets for 2023, as it announced the construction of 24,000 homes has begun – with 22,400 completed this year so far.

In September, it was revealed that under a quarter of the state’s 5,500 affordable homes target had been reached. In October it was revealed that under 700 homes had been delivered under the government’s First Home Scheme.

The Department of Housing included the number of approved applications in their calculations, not drawdowns. Therefore, it is possible that the figure in October was much lower.

These schemes allow first-time buyers and prospective property owners on lower incomes purchase a home.

Managing director of the Lotus Investment Group Ian Lawlor suggests that “first-time buyers are very much propelling the residential property market and the backing of Government initiatives has been a crucial support”.

Lawlor said: “However, the persistent challenge of housing supply remains a nationwide concern, primarily attributed to delays in obtaining planning permissions.

“With such undeniable demand for housing, the Government needs to investigate the root cause of these delays that are hindering so many people from securing a home and starting the next chapter of their lives,” he added.

The CSO property price index data also revealed today that median prices of a home remains at €320,000 nationwide – while the cheapest location, Longford, has also remained dormont at €160,000.

The highest median price, in the Dún Laoghaire-Rathdown authority, have increased slightly – reaching €635,000.

Niall Corkery, Statistician in the CSO’s Prices Division, said: “The most expensive Eircode area over the 12 months to September 2023 was A94 ‘Blackrock’ with a median price of €735,000, while F45 ‘Castlerea’ had the least expensive price of €130,000.”