House prices fall 10.6% in past year

MORE misery was heaped on homeowners yesterday with news that house prices have fallen by 10.6% in the past year as average house prices are now estimated to be €267,594, down from €287,887 in December 2007.

The figures, published by Irish Life & Permanent and the ESRI (Economic Social Research Institute), show that prices fell by 1.1% last month — the 19th consecutive monthly fall.

The 1.1% decrease shows a further downward spiral in prices, following a 0.9% reduction in August, a 0.2% decrease in July and a 0.6% drop in June.

Dublin house prices fell by 0.8% in September, while homes outside the capital lost 1.6% value.

The reports shows that in the first nine months of this year prices for Dublin and outside were down 6.6% and 8.2% respectively. Prices in commuter belt counties of Louth, Meath, Kildare and Wicklow fell an average of 1.3% in September.

A year-on-year reduction to September 2008 in commuter counties of 10.2%, compared to a 9.0% drop in the 12 months to August.

The average three-bed semi reduced by 1.2% in September 2008, compared with a reduction of 0.2% in August. Last December a three-bed semi was going for €299,412, but had fallen to €282,902 by last month.

According to the report house prices for first-time and second-time buyers were reduced by 1.2% and 1.3% respectively in September 2008. In August these rates showed reductions of 1.2% and 0.8%.

Year-to-date prices for first-time and second-time buyers were down 8.1% and 7.0% respectively.

The average price paid by a first-time buyer and a second-time buyer in September 2008 was €239,598 and €299,074 respectively. Equivalent prices last December were €260,786 and €321,498.

Prices for new and second-hand houses reduced by 0.4% and 1.5% in September and the average price paid for a new house that month was €269,932.

Niall O’Grady, Irish Life & Permanent’s manager of business strategy said there was little surprise in the figures. “We expect this pattern to continue for some time as both consumer confidence and the economic outlook for the year ahead remain weak,” he said.