House Price Index shows some decline in prices

National house prices showed no growth in February of this year while prices in a number of sub-sectors of the market declined slightly according to the latest edition of the permanent tsb / ESRI House Price Index.

In each of the previous three months (November, December and January), national prices grew by just 0.1%. National prices have increased by just 1.6% in the six months up to and including February.

Measuring the rate of growth in the 12 months (year on year) to February, national prices rose by 9.5%. This was down from 10.6% recorded in the 12 months to January this year.

The average price paid for a house nationally in February 2007 was €311,078, compared with €310,632 in December 2006.

"The housing market is clearly in a period of price realignment, with very moderate price growth the most likely outcome this year,” said Permanent tsb Bank’s head of marketing, Niall O’Grady.

“The housing market is clearly in a period of price realignment, with very moderate price growth the most likely outcome this year. Clearly stamp duty uncertainty in advance of the election is a factor as is recent rises to interest rates. It’s difficult to imagine much momentum coming back into the market until the stamp duty issue is resolved after the election.”

Dublin house prices grew by 0.2% in February while there was a reduction in prices of 0.1% for houses bought outside Dublin. In January 2007 the relative price increases were 0.1% and 0.4%.

House prices grew by 13.2% and 8.7% in the twelve months to February 2007 in Dublin and Outside Dublin respectively. The equivalent rates to January 2007 were 14.7% and 9.7% respectively.

The average price paid for a house in Dublin and outside Dublin in February 2007 was €428,850 and €267,293 respectively. The equivalent prices in December 2006 were €427,343 and €266,339.

House prices for first-time were unchanged in February, while prices for second-time buyers fell by 0.4% in February 2007. In January 2007 the equivalent rates showed growth of 0.1% and 0.2%.