HOUSE PRICES HAVE risen by almost 1.5% over the last three months, a new study has found.

A record number of mortgage approvals and a lack of supply have driven the increases, according to the quarter four Real Estate Alliance (REA) House Price Index.

The average three-bedroomed semi-detached house is now reaching sale agreed status after just six weeks on the market, falling from a 10-week average in June.

Many estate agents are reporting that houses are reaching sale agreed status within a four-week period, as mortgage-approved buyers chase a limited amount of stock.

Despite fears of a downturn in the market during the Covid-19 crisis, the price of a three-bed semi across the country rose by more than €3,000 over the past three months to €239,194 – an annual increase of 1.9%.

Spokesperson for the REA Barry McDonald said that “people are watching the market very closely, and our agents are finding that as soon as they put a property up on our sites, the majority of the inquiries are coming within the first 48 hours”.

“It is hard to imagine that the market would perform better during the crisis than before it, but we are witnessing the highest demand levels that I have seen,” McDonald said.

The biggest rises in the fourth quarter of the year came in Ireland’s secondary cities and the commuter counties.

Both of these experienced the least movement in prices over the preceding 18 months.

The upsurge in demand is nationwide and was illustrated by REA agent Harry Sothern in Carlow, who has reported being practically sold out – with five properties up for sale when he would usually have 25.

The situation is mirrored in the capital, where there are just nine three-bed properties for sale in total in the Dublin Four area, according to agents REA Halnon McKenna.

McDonald said: “Putting a house on the market in early December would previously have been considered naive – however this year, any suitable properties placed on the market have been sale-agreed before Christmas.”

The price of a three-bedroomed semi-detached house in Dublin City rose by 0.6% to 431,833 euros during the past three months, an annual increase of 1.41%.

However, with demand for homes with gardens as a main buying driver, interest in capital city areas such as Clontarf (+4% to €625,000) has skyrocketed in the past few months.

“A lot of employees from the big tech companies are moving over to Clontarf area and trading up from apartments in the city,” said Jim Gallagher from REA Grimes in Clontarf.

North County Dublin prices rose by over €6,500 on average to 311,670 euros – up 2.2% on the Q3 figure, while South County prices increased by 0.5% to €418,791.

Cork, Limerick, Galway and Waterford cities shared a combined increase of 2.4% in the past 12 weeks with prices rising by €6,000 to an average of €262,500.

Waterford City showed the biggest increase in this category, with prices rising by €15,000 in 12 weeks to €230,000 – a change of 7% since September.

Galway City saw prices rise by €5,000 (1.8%) in the same period, with any property with Home Office Potential (HOP) continuing to attract attention, according to agents McGreal Burke, and properties going sale-agreed after four weeks.

Cork City saw its first price movement in over a year with a 1.6% uplift to €325,000, while Limerick prices remained stable.

Commuter counties are now feeling the benefit of the migration towards space and home working potential, with three-bed semis rising 2.2% by almost 6,000 euros on the Q3 figure to an average of €253,111.