Upswing in new home sales ‘likely’

NEW home sales should pick up in the autumn, estate agency CB Richard Ellis predicted yesterday.

The estate agents said the new homes market is experiencing a temporary correction similar to the ones in 1998 and 2001.

“We are not suggesting activity will rebound to the extraordinary levels experienced over the last number of years. However we believe a resumption to a steady sustainable level of new homes sales activity is certainly achievable on the basis that buyers will regain confidence now that interest rates appear close to their peak and there is growing evidence that construction levels are easing considerably,” the company said in its bi-monthly property market review.

CB Richard Ellis says it already sees some positive signs in the new housing market with 30 units sold in the Adamstown housing estate in Dublin in the opening week.

It also believes the forecast from the Department of the Environment that 77,000 housing units will be delivered in Ireland in 2007 is more realistic that the “pessimistic estimates being mooted by some commentators”.

Commenting on the retail market, it said recent pedestrian counts on Dublin’s prime shopping streets confirm the Irish retail sector continues to perform well, with a year-on-year rise in ‘footfall’ of almost 26% on Henry Street and 44% on Grafton Street in the third quarter.

It sees plenty of growth in the retail sector to come with groups like Marks & Spencer, Heatons, Harvey Norman and Tommy Hilfiger all looking to add shops.

Pub sales have also held up well with 17 in the Dublin area changing hands so far in 2007 with an estimated value of €100 million.

This is similar to the 2006 number, though CB Richard Ellis said the final quarter of 2006 saw an extra 20 sales and that figure is unlikely to be repeated this year.

The office market is also performing strongly with 80,000sq m of space taken up in the last three months.

“The ongoing turmoil in the financial markets will no doubt raise questions about the sustainability of office demand and prospects for rental growth going into 2008.

“However, there is no evidence of any measurable impact on demand levels,” the CB Richard Ellis report said.