Property prices back at Celtic Tiger peak with Kinsale homes third most expensive in country
The average price of a home bought in Kinsale, Co Cork, was €493,457. The average price in Cork City in the last 12 months was €313,900 and it was €305,047 in Cork county.
Property prices in Ireland have reached their highest level since the peak of the Celtic Tiger boom, with double-digit percentage rises in the cost of homes in every part of the country over the last year.
The Central Statistics Office’s latest Property Price Index for June stood at 163.6 points, which is equal to the highest level recorded at the peak of the property boom in April 2007.
Experts have warned that with significantly higher rents and increased difficulty in getting a mortgage when compared to 2007, it will continue to be harder for people to buy their first home.
Furthermore, fears over inflation in the construction sector mean that prices may continue to rise at pace in the medium term.
In the year to June, the price of properties in Ireland rose 14.1%. This is slightly lower than the 14.4% yearly increase reported in May 2022.
Regardless of the type of home or where they were located, the cost of purchasing a home or apartment is up by at least 10% in the last year.
Households paid a median, or mid-point, price of €290,000 for a home in the 12 months to June.
The average price paid for a home in Cork City in the last 12 months was €313,900 and it was €305,047 in Cork county.
By Eircode, the most expensive area in the country to buy a home was in Dublin 4, at an average of €933,244.
The average price of a home bought in Kinsale is nearing half a million euro and is the third highest in the country outside of Dublin, at €493,457.
Across Munster, average prices varied considerably by Eircode:
- Killarney - €282,390;
- Limerick - €258,178;
- Skibbereen - €324,933;
- Carrigaline - €362,350;
- Cork City northside - €287,314;
- Cork City southside - €352,025;
- Ballincollig - €370,516;
- Waterford - €246,584;
- Ennis - €250,817;
- Thurles - €188,640.
Property price inflation in June 2022 was more than double the rate it was in June 2021. Since prices hit their lowest point in early 2013, they have since more than doubled.
Architect Mel Reynolds said that with rents at record levels and double-digit price growth in property, it is significantly harder now for first-time buyers to get on the property ladder than when prices were last at this peak in 2007.
While wages have not significantly increased since 2007, rents are up over a third since that time.
While the rules now limit the maximum amount someone can borrow to 3.5 times their annual income, the Central Bank has noted that during the previous peak, around one-fifth of mortgagees could access five times their income.
“The likelihood of a crash [in house prices] is remote,” said Mr Reynolds.
"We have the demand but the transactions just aren’t happening at the level they were back then. And construction inflation is definitely a factor now.”
Rachel McGovern, director of financial services at Brokers Ireland, said that the latest CSO figures suggest property price inflation may be stabilising but that many aspiring buyers are being squeezed out.
Pointing to recent ESRI research highlighting the collapse in the number of people aged 25-34 owning their own homes, she said: “There are severe societal and economic consequences to allowing such a trend to continue.
“Yet one could not point with any degree of confidence to it being reversed in the foreseeable future.”
Reacting to property prices reaching the previous high watermark, a spokesperson for Minister for Housing Darragh O’Brien said that increasing supply of all types of housing would be key to meeting demand and moderating prices.
Pointing to the higher numbers of homes completed in the first half of this year compared to previous years, the spokesperson added: “This significant increase in supply is promising, considering the effects of the previous two years on the homebuilding industry in addition to recent inflationary pressures and the war in Ukraine, but we do need to get to a point where we are delivering on average 33,000 new homes per year.”
