Glenveagh: Price of new builds to rise 6%

Glenveagh: Price of new builds to rise 6%

By Eamon Quinn

The price of new builds for first-time buyers will continue to rise by an annual 5% to 6% for the next few years, although the Central Bank’s mortgage lending rules are weighing on prices in the second-hand market, says Glenveagh Properties.

The stock market-listed firm, which raised an additional €210m last month after its Dublin market debut last summer, said it has “no nervousness at all” about the first-time market which it supplies.

Potential ECB rate increases and the Central Bank’s macro-prudential rules will affect the second-hand market, however, and prices across the market will ease back to post single-digit growth next year.

Following a tax credit of €1m, Glenveagh had a net loss in the six months to the end of June of almost €7.16m on revenues of over €1.29m. 

The “market backdrop remains very favourable”, it told analysts and it was not changing its land purchase plans focused on Dublin, though Cork and other urban areas remain on the agenda.

As it seeks to use the proceeds of its shares sales, it said most of its land purchase deals have been struck off-market.

In the rental market, it has attracted “quite a few” inquiries about its Herbert Hill site in Dundrum. 

Asked about its share price, the company told reporters the performance was “a bit disappointing” but that banks and Reit firms across the market had sold off in recent times.

It said it is confident about the long-term outlook.

The shares, which fell 1.6% to €1.06 yesterday, have traded as high as €1.26 this year.

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