Price of property slides but sales rise

House prices fell by nearly 3% in the last three months of 2012, bringing last year’s overall drop to 14.8%.

Property prices fell steadily last year, but the rate of decline increased in the last quarter, with prices falling 2.9% in October, November, and December compared to a 2.2% drop in July, August, and Sept-ember.

However there is good news out there, as the number of houses sold nationally was up 15.4% on 2011.

According to the latest house price survey from myhome.ie, the average house price nationally now stands at €201,000 — down 51.5% from the peak of the housing boom.

The average property price in Dublin is now €236,000 — 56% below the peak in late 2006.

An analysis by myhome.ie of transactions on the Property Price Register shows that about 21,000 homes exchanged hands last year — up 15.4% on the 2011 figures but almost unchanged from 2010.

According to Caroline Kelleher from DKM Economic Consultants, who completed the study, it was “a year of two halves for the property market” .

She said that while the second half of 2012 was better than the first, the outlook for the property market remained uncertain.

“While we saw relatively large house price declines in the first six months, this gave way to significant moderation in the rate of decline nationally in the latter half of the year and to price stabilisation in Dublin.

“But, the disposable incomes of prospective buyers will be severely affected in the coming year by the measures announced in Budget 2013 — in particular the introduction of the property tax and the abolition of mortgage interest relief. And this will have a knock-on effect on consumer confidence and the ability of individuals and couples to service a mortgage.”

Angela Keegan, managing director of myhome.ie, said the moderation in the pace of decline, the increase in the number of transactions during 2012, and the establishment of the Property Price Register were all positives that could be built on.

“The advent of the Property Price Register brought transparency to the market and we warmly welcome that development.

“The increase in transactions, especially cash transactions — they made up a staggering 46% of transactions in the first nine months of the year — was also a notable development.

“However, unless the impact of the budget measures are offset by economic growth, increased employment and a recovery in consumer confidence, the prospects of a recovery in the coming year could be problematic.”

The property sales website said that the price of four-bed homes has stabilised or increased in many counties. They believe such homes may now be the preferred house type of choice.

The study also shows that reaching “sale agreed” varies enormously around the country. In Limerick, it takes up to three months, Dublin four months, and five-and-a-half months in Galway. The time in Munster is 10-and-a-half months, it is nine months in Ulster and Connachy, and seven months in Leinster outside of Dublin.

Galway recorded the biggest price decline in October, November and December, at 5.1%, and annually at 17.8%. The median price for a property in the city is now €185,000. Cork saw prices decline by 2% in the final three months of 2012, and 13.3% for the year to leave the median price at €195,000.

In Limerick and Waterford, asking prices are down more than 13% in the year, with the median prices at €155,000 and €160,000 respectively.

*www.propertypriceregister.ie