40% of houses bought in cash sales: survey

Cash is still king when it comes to buying houses, with cash purchases accounting for four out of every 10 house sales.

40% of houses bought in cash sales: survey

According to the latest DNG House Price Gauge, house prices in Dublin show signs of levelling off. It also noted that cash transactions are still very prevalent, accounting for 35% to 40% of sales.

A significant proportion of these sales are block and fund sales and cash buyers are still likely to account for 35% to 40% of all non block/fund sales.

The DNG analysis found that house prices have risen by 0.5% in the third quarter, with the average price of a resale home in Dublin now standing at €374,000.

The property market in the capital has now reached the 50/50 mark where prices are still around 50% lower than at their peak but have risen by more than 50% since the market low point in 2012.

However, the DNG research found that approximately 20% of all house sales in the Dublin area were multi-unit or block sales in housing developments to single purchasers with a corresponding figure of 10% for the rest of Ireland.

Chief executive of DNG Keith Lowe said the number of cash transactions was in decline and would fall further as banks start lending more money. However, he said the Central Bank’s loan restrictions were hindering first- time buyers.

“Some buyers are struggling to meet the revised mortgage criteria and are now opting to stay either in their family home or in rental accommodation for longer which is putting additional strain on the rental sector.

“A buyer purchasing a first home in Dublin at a relatively average €350,000 must raise a personal deposit of €48,000 and this in our view is not a realistic expectation for many potential purchasers,” he said.

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