Apartments nationally lost 51% of their value since prices peaked in early 2007, while in Dublin the fall in values was slightly worse, hitting 52%. That’s an average: estate agents Savills Ireland said yesterday they had sold apartments last year at prices up to 60% lower than peak values.
Figures for houses meanwhile show drops of 45% in Dublin, which accounts for about 40% of the market, and falls of 35% in the rest of the country. But those are also averages — Savills recorded sales where houses went for 55% less than their 2007 values.
One of the surprises revealed by the figures which were compiled by the Central Statistics Office (CSO) is the rate at which prices fell in the last few months. Prices had been dropping at about 1% per month over the past year but they collectively fell by 1.7% in February and March while apartments slumped dramatically in March, falling by 3.9%.
Savills head of research Joan Henry said this was probably a reaction to the well-signalled interest rate rise last month and the expectation that further costly increases will be announced in the coming months.
The CSO figures, which go back to 2005, collate for the first time actual borrowings drawn down from the eight main banks and mortgage providers which finance 98% of home purchases. They are correct up to six weeks ago, which makes them more comprehensive and up to date than previously available.
Up to now, market watchers have had to rely on reports compiled by individual banks, which represent only a sample of the market. They have their limitations: international ratings agency Standard and Poor, for example, reported last week that residential property prices had fallen 33% since the peak and had hit bottom.
The new CSO index is part of a European Commission requirement to standardise the collection of property price information across all member states and it will be updated every month from now on.
Frank Conway of the Irish Mortgage Corporation welcomed the CSO report as a step towards eliminating a “black hole” in reliable information on the property market. “The first time buyer market is beset by uncertainty,” he said.
“Property prices, job stability and access to funding make up a troika that continue to dampen appetite and people’s ability to purchase. However, the launch of the property price report from the CSO will at least provide certainty in respect of property prices.”
He said its launch will represent a “new measure against which to base the important decision to buy”.