Selling price of houses drops 15% in two years

THE selling price of houses has plunged by 15% over the past two years.

Asking prices, however, are just 3% below their peak in 2006, although Dublin is down almost 5%.

This is according to the latest MyHome.ie property report, which said sellers have begun to adapt to the realities of the market and are accepting lower prices.

In the first three months of this year alone asking prices are down 1.4%compared with the final quarter of last year. This compares with an average decline of 0.4% per quarter during 2007.

In Dublin, the decrease was 1.3% in the first quarter of this year compared with 0.8% during last year.

New houses saw the largest reversal from an average rise of 0.3% per quarter last year to a fall of 1.5 % in the first quarter of this year.

Asking prices are beginning to fall faster in the first quarter of this year, according to NCB economist Eunan King.

“This is welcome in that it helps the market adjust to the new supply and demand situation. However, sales price declines continue to outpace those of asking prices, suggesting asking prices may have more to run to the downside,” he said.

The report said the fall in actual sale prices has been reported as a 7% to 8% fall in 2007. It said anecdotal evidence from around the country is that sale prices at this stage have fallen by 15% from the 2006 peak or even more in certain areas.

Also in the first quarter of this year, the stock of houses for sale was up more than 30% on the same period in the previous year, while sales were down nearly 30% compared with a year ago.

MyHome.ie chief executive Jim Miley said: “There is some evidence the overhang of supply in the market is beginning to clear in certain areas, most notably in parts of north and south Dublin, as the level of property transactions begins to increase.

“The continuing downward movement in prices, combined with the increasing willingness of sellers to accept lower than previously expected prices will ultimately restore the supply-demand balance in the market although it is likely to take some time yet to achieve that balance,” he said.

The average length of time to sell a house is a little less than 180 days compared with in excess of 210 days at the end of last year.

“Well-priced property, both new and second-hand, is attracting buyers with increased transaction levels reported,” added Mr Miley.

Home sweet home

Asking prices for three-bed semi-detached houses (Q1 2008 compared with Q4 2007).

* Nationally: Down 4.43% to €361,398.

* Dublin: Down 0.25% to €511,382.

* Cork: Down 2.53% to €319,304.

* Kerry: Up 2.45% to €270,972.

* Limerick: Down 0.97% to €247,128.

* Wicklow: Down 4.12% to €434,046.