Although there has been a steep fall in the price of large and luxury homes, the biggest drop since the 2007 peak is in one-bed and two-bed apartments and smaller houses.
In a comprehensive analysis of asking prices in more than 4,500 areas of the country, by house-type and size, property website Daft.ie has found that:
* The price of an average one-bed apartment fell 62% since 2007 from €231,000 to €88,000;
* Two-bed terraced houses are 59% cheaper, at €113,000, down from €273,000;
* Average three-bed semi- detached is down 55% from €343,000 to €156,000;
* Four-bed bungalow prices have fallen 50% from €519,000 to €262,000;
* Five-bed detached houses are, on average, 48% cheaper at €330,000, compared to €630,000 in 2007.
The report points to the increased difference between a two-bedroom and a four-bedroom property now and in the latter stages of our property bubble. From a 45% premium for bigger houses near the height of the housing boom, the average difference between such homes has increased to 58%, and the variation looks set to continue.
“There’s going to be weak demand for one and two-beds into the future as people look to buy. As they think about having a family into the future, they’re going to be looking to buy something that will do them for 15, 20 or 30 years,” said Ronan Lyons, economist with Daft.ie.
“There isn’t really an investor market at the moment, and the people coming five or 10 years after those who bought for the first time in the boom aren’t really interested in a one or two-bed home.”
In its regular review of asking prices, Daft found they stabilised in the second quarter of 2012 in Dublin, parts of the South-East and Cork City. However, prices listed for homes outside the main cities are down from €162,000 to €149,000 since December, and fell 8% to 13% in Longford, Mayo, Donegal, and Galway in the past three months.
CSO figures last week showed the first monthly increase in house sale prices since 2007 in May.
The latest data also comes after last week’s launch by Housing Minister Jan O’Sullivan of schemes to help homeowners in trouble with their mortgages, who can give up ownership and become tenants of housing agencies who would buy the properties with bank and state loans.
The scheme may suit many of those in the smaller homes worst affected by dropping values, as only homes worth less than €180,000 (or under €220,000 in the Dublin area) will be eligible.
However, Mr Lyons said there should also be a scheme for people whose mortgages are not distressed, but who want to upsize from a one-bed or two-bed home they bought to get on the ladder.
“One option would be to allow them become landlords of the one-bed and become a tenant somewhere else,” he said.