Decline in property market is set to continue

The property market is at its lowest ebb since the start of 2017, with sales down by up to two thirds in April, compared to the same month last year due to the pandemic.
Decline in property market is set to continue
Overall, the market contracted by 4.6% in the first three months of the year, a figure which will prompt concern, as restrictions due to the virus only came into effect at the very end of this period. Photo: iStock

The property market is at its lowest ebb since the start of 2017, with sales down by up to two thirds in April, compared to the same month last year due to the pandemic.

Further drops are expected in the coming months as the impact of the construction shutdown is felt.

A new study, based on an analysis of residential property sales recorded in the Property Price Register in the first three months of 2020, shows sales collapsing by at least 6% in seven counties.

Overall, the market contracted by 4.6% in the first three months of the year, a figure which will prompt concern, as restrictions due to the virus only came into effect at the very end of this period.

The study, conducted by property website MyHome.ie, shows that 11,161 sales were completed in the first three months of the year. This was down from 11,702 in the same period in 2019, and is the lowest the market has been since the first quarter of 2017.

The picture looks set to worsen.

While the register for April 2020 is not yet complete, the data available at the time of print shows 1,451 sales were completed by April 24, 2020.

By comparison, more than 4,500 sales were completed in April 2019, and some 3,900 were completed in April 2018.

The analysis from MyHome.ie shows the impact varied broadly in different parts of the country.

Sales dropped by 7.2% in Dublin, and by 3.6% in Cork, but rose by 7.2% in Limerick. They remained relatively stable in Galway (down 0.5%), and Waterford, where sales were up 0.6%.

Thirteen counties saw a fall in sales, eight counties experienced rises, and five counties stayed flat.

The biggest rise in sales came in Monaghan, where the number increased by 28.6%, though just 90 sales were completed so far this year.

Significant drops were recorded in Wexford (down 17.8%), Kilkenny (-15.2%), Kildare (-16%), and Tipperary (-13%).

Dublin, which accounts for almost a third of sales in the Irish market, recorded 3,482 sales in Q1 of 2020.

The capital was followed by Cork with 1,267 sales, and Kildare with 567. The counties with the lowest number of sales were Longford (91), Monaghan (90), and Leitrim (89).

Experts have said the early weeks of the year showed signs of confidence in the market as the Brexit question was finally resolved.

However, this has been completely negated by the virus crisis, said Angela Keegan, managing director of MyHome.ie.

“Brexit uncertainty had a significant effect on sales activity in late 2019, something which was apparent into the new year,” she said.

“This was compounded by Covid-19 at the start of March, just when we thought we would see an increase in sales. The Government’s roadmap for the easing of Covid-19 restrictions states that construction workers can resume work from May 18.

"This clarity is welcome as, the longer we wait for construction to resume, the greater the fall-off in new homes will be, which is something the market can ill-afford at present.”

It is anticipated the virus outbreak will have a significant impact on pricing too.

Data issued by the CSO showed prices were close to bottoming out earlier this year, rising by 1.1% in the year to February.

The data covered the period immediately before the virus outbreak and, at the time, economists and estate agents warned that activity had collapsed since the issuing of restrictions in March.

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