House prices continue to fall

The auctioning of distressed properties at 60% below peak levels has brought down houses prices, it was claimed.

Daft.ie revealed the average asking price of residential properties around the country fell to €196,000 in June, almost half of 2007 rates.

In Dublin, Cork, Galway and Limerick asking prices fell by 5.7% between April and June. Waterford city saw a 9% drop, with asking prices down by 10% in Donegal, Cavan, Laois and Offaly.

Ronan Lyons, economist with Daft.ie, said the second quarter of 2011 has seen one of the sharpest adjustments in prices over the last four years.

“With successful auctions of distressed properties at 60% or more below peak levels, the sharp fall may actually reflect increased realism on the part of sellers,” he said.

“Other factors are also important though. One is the intense competition sellers face due to the high level of stock sitting on the market, especially outside Dublin.

“Another factor is that would-be buyers continue to face significant obstacles to obtaining a mortgage.

“Nonetheless, over half of properties posted for sale in Dublin at the start of the year are now sold or sale agreed.”

The report by Daft.ie, Ireland’s largest property website, is based on its database of properties including the 30,000 posted in the second three months of 2010.

It found the smallest falls in asking prices – less than 2% – were in Kerry and Mayo.

Daft.ie has about 90,000 properties listed on its site, of which about 7,000 are in Dublin. Today's report was based on 30,000 properties newly listed for sale (or re-listed at a different price) between April 1 and June 30 this year.

Rival property site MyHome.ie maintained new homes were back at 2001 prices.

MyHome.ie lists 50,000 properties nationwide, with about a fifth of those in the Dublin market.

It stated asking prices fell to an average to €249,000 by June, with €10,000 taken off one-bedroom apartments.

Angela Keegan, of MyHome.ie, said any recovery in the housing market would depend on a range of wider economic issues including employment growth. Its database revealed the annual rate of decline is 14.4% nationally and 15.7% in Dublin – to €249,000 nationwide and €286,000 in the capital.

“Clearly consumer uncertainty is discouraging buyers from availing of the greater affordability which clearly exists,” said Ms Keegan.

“The prices of four bed-semis actually rose in counties Kilkenny, Westmeath, Longford, and Wicklow while the median price of a three bed semi in Limerick remained the same at €175,000, indicating asking prices may be bottoming out at that level,” said Mr Keegan.

“The figures from around the country underline the fact that the market is fragmenting into a number of micro markets dependant on a range of local factors.”

The median asking price in Cork is now €239,000, in Galway its €234,500, while in Limerick it is €185,000, according to MyHome.ie.