Cash buyers are paying less for properties than those who need to get a mortgage and first-time buyers are being squeezed out of the market.
The findings are contained in the newly revamped property price index from the Central Statistics Office (CSO) which is now based on stamp duty returns and includes cash buyers for the first time.
The CSO data now shows that the collapse in property prices was more pronounced than previously thought, while the recovery has been slightly stronger.
For example, the peak-to-trough fall in residential property prices was 54.4%, not 50.9% as recorded previously.
Similarly, the price increase from the trough to July of this year is 43.2% using the new index, whereas it was previously estimated as 37.4%.
The CSO confirmed that cash buyers — who are estimated to make up around 50% of the market — pay less for property than those who must buy their house by securing a mortgage between 2010 and 2016 and that the differential was most pronounced when the market was at its lowest and outside of Dublin.
Throughout the period 2010 to 2015, former-owner-occupiers have consistently paid the most on average for housing, followed by first-time buyers. Non-occupier households have consistently paid the least.
The CSO also found that first-time buyers have gradually been pushed out of the market between 2010 to 2015.
In 2010, they represented 53.1% of all household market transactions filed. By 2015, first-time buyers’ share fell to just 24.4% of the market. In the first seven months of 2016, first-time buyers accounted for 24.6% of household market purchases.
Across the country, residential property prices rose by 6.7% in the year to July. This compares with an increase of 4.9% in June and a rise of 6.1% recorded in the year to July 2015.
Residential prices increased by 2.5% in the month of July compared with an increase of 1% in June and an increase of 0.8% in July of last year.
Residential property prices are currently 34.7% lower than at their highest level in April 2007.
Prices declined steadily over the years 2010 to 2011, followed by a bottoming-out in 2012 to 2013.
“Since then, prices have risen again. However, the rise in prices has been uneven, with noticeable fluctuations up to the present point in time,” noted the CSO.
In the Dublin residential property market, prices increased by 3.8% in the 12 months to July. This compares with an increase of 2.5% in the year to June and an increase of 4.5% in the year to July 2015.
Dublin residential property prices increased by 1.6% in the month of July compared with an increase of 0.4% in June and an increase of 0.4% in July of last year.
Residential prices in the capital are now 58.2% higher than their lowest level but remain 35.3% below their peak price level in 2006.
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