House prices jumped by 7.1% in the 12 months to April as the Government faced renewed warnings about Ireland’s housing crisis.
New figures from the Central Statistics Office (CSO) show that, although house prices are on the rise, it is somewhat slower than last year, when the year-on-year increase to April stood at 15.8%
Residential property prices increased by 0.3% in the month of April. This compares with no change in March and an increase of 0.6% recorded in April of last year.
In Dublin, residential property prices increased by 1.6% in April and were 4.6% higher than a year ago. Dublin house prices increased by 1.9% in the month and were 5% higher compared to a year earlier.
Dublin apartment prices were 1.1% higher when compared with the same month of 2015.
Residential property prices across the rest of the country decreased by 0.6% in April compared with an increase of 0.3% in April of last year. However, prices are still 9.5% higher than in April 2015.
House prices in Dublin remain 33.1% lower than they were at their highest level in early 2007 while apartments are 41.5% are lower than at their peak.
The price of residential properties in the rest of the country is 35.8% lower than their highest level in September 2007. Overall, the national index is 33.3% lower than its highest level.
Reacting to the figures, the director of Property Industry Ireland, Peter Stafford, said the moderation in the growth of house prices in Dublin and the rest of Ireland is masking an ongoing accommodation crisis in Ireland, particularly in the rented and social housing sectors.
“While moderation in house price growth is good for those looking to buy their own home, there is little good news in these figures for tenants or those looking for social housing where a crisis of accommodation still exists,” he said.
“Ireland’s looming accommodation crisis demands a speedy responsive action from Simon Coveney, the new minister for housing, planning and local government, in close collaboration with his ministerial colleagues, state agencies, and the private sector.”
The director of research at Savills, John McCartney, said the lack of lending was pushing people into the overstretched rental market.
“This is exactly what we predicted. Price growth slowed in Dublin last year as tighter mortgage lending forced people into renting. However, this slowdown was always going to be temporary; the shift to renting has forced up rents, attracting investors who are now scrapping to buy properties and driving up prices.
“As this continues the Dublin market may become increasingly like London with expensive properties, many of which are owned by investors,” he said.
Mr McCartney says Dublin house price inflation will heat-up further in the coming months
“The only thing preventing stronger inflation in today’s figures was the strong growth recorded 12 months ago.
“However, prices slowed sharply from last May, meaning that next month’s figures will be compared to a much weaker base. This will almost certainly result in faster house price inflation next month,” he said.
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