Government must help average earners overcome 'impediments' to homebuying, say auctioneers

The latest House Price Report from Daft.ie showed the number of homes for sale in Ireland last year was “dramatically below” pre-covid levels, despite the increased supply of new homes in the country. File picture

There are “growing impediments” to buying a home in Ireland for the average wage earner, which has meant activity in the market is “largely confined” to those on higher incomes.

The Institute of Professional Auctioneers and Valuers (IPAV) said that the availability of homes at affordable prices for those earning average wages remains “the main issue stalking the market for the last decade”.

IPAV chief executive Pat Davitt said: “Social cohesion into the future is a real concern arising from lack of access to housing. We need urgent and practical measures, and we certainly do not need to see the issue treated as a political football in the run-in to elections.” 

Mr Davitt was reacting to the latest House Price Report from Daft.ie, which showed the number of homes for sale in Ireland last year was “dramatically below” pre-covid levels, despite the increased supply of new homes in the country.

House prices rose by an average of 3.4% in 2023 according to the report. This was the smallest annual increase since 2019. Furthermore, it highlighted a large disparity between the average price of a new home and a second-hand home.

While the average listed price across the country was €320,046 in the last quarter of 2023, it was far higher for new builds with the median price of a new home standing at €407,500 in the first three quarters of 2023, peaking at €650,000 in South County Dublin.

Sinn Féin housing spokesperson Eoin Ó Broin said that the figures show new house prices are “out of control”, with the problem exacerbated by a dearth of affordable homes.

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“The gap between new and second-hand homes is enormous and growing,” he said. “This is a direct consequence of bad Government policy, demand-side subsidies such as so-called 'Help to Buy', and the controversial Shared Equity Loan scheme, all pushing up new house prices.

“Government policy must shift to bringing the price of new homes down. They must end policies that push up house prices and they must increase and accelerate the delivery of genuinely affordable homes by Local Authorities and AHBs, at prices that working people can genuinely afford.”

Previous analysis of the Help to Buy scheme from the independent Oireachtas Parliamentary Budget Office said that the scheme has fuelled property inflation, as a third of claimaints did not need help to raise the 10% deposit required.

Pat Davitt, CEO of IPAV, said: “Social cohesion into the future is a real concern arising from lack of access to housing. We need urgent and practical measures, and we certainly do not need to see the issue treated as a political football in the run-in to elections.” 

IPAV, however, defended the Government’s schemes such as Help to Buy and said without them the equation would be “even more dramatic”.

Mr Davitt added: “In 2024 the Government needs to look urgently at addressing deep impediments that have changed little over the last decade, including, the high State take on home building; planning policy chaos and policy makers and influencers antipathy towards, and fear of, being seen to aid SME builders and developers who have traditionally been the mainstay of the Irish home building sector.”