THE LATEST REPORT from property website Daft.ie found a ‘modest’ fall in house prices in the final quarter of last year.
The average listed price nationwide in Q4 stood at €309,941, which represents a 0.4% fall from the previous quarter.
It is also 16% below the Celtic Tiger peak.
The data reveals a 6.1% rise in prices during 2022, down from 8.1% in 2021 and 7.7% in 2020.
Ronan Lyons, economist at Trinity College Dublin and author of the report, said:
2022 started with a continuation of the significant upward pressure on prices seen during the second half of 2020 and in 2021. However, the year ends with prices falling, albeit modestly, in the final quarter.
“While supply has increased, availability is still tight, indicating that the change in market conditions is more likely driven by a change in the strength of demand.”
With a fall in prices in Q4, and largely static prices in Q3, this would represent the first time since the second half of 2019 that prices have recorded such a dip.
“The last time this happened. [...] it could be interpreted largely as a sign of supply, both new and secondhand, at long last coming up to the levels needed to meet market demand,” Lyons said.
He noted that supply, disrupted by the pandemic, has almost returned to pre-2020 levels. 64,000 homes were put up for sale last year, just shy of the 70,000 in 2019.
Lyons said there are reasons to predict a ‘cool off’ in demand:
“On the one hand, interest rates have risen. One mortgage market provider started the year with fixed rates below 2% but will enter the new year with rates for the same product of almost double that. This mathematically filters through to affordability and the maximum loan a provider will lend.
“Underpinning the change in mortgage market conditions, though, is of course a wider change in macroeconomic conditions, at least part of which is related to economies adjusting to a post-lockdown world and to the war in Ukraine. Such uncertainty makes people less confident about the future.”
The average list price and year-on-year change for major cities in Q4 2022 was:
Note: Journal Media Ltd has shareholders in common with Daft.ie publisher Distilled Media Group.
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