- Prices nationally declined by 7.3% compared to growth of 11.8% in 2006
- Price reduction in second half stronger than that in first half
- Price reduction highest in Dublin (-7%) compared to Outside Dublin (- 6.4%)
- Prices for existing houses (- 9.0%) decline more than prices for new house (- 4.1%).
The Irish Auctioneers and Valuers' Institute reported last month that there are 40,000 vacant apartments in Dublin.
It estimated that the price of apartments fell 17% in 2007.
Some builders are opting to rent new apartments rather than try to sell them. The former gasholder at Ringsend is one of a number of newly built apartment buildings in Dublin that is lying empty as developers adopt a wait-and-see approach in the ailing new homes market.
In the Ringsend case, the developer is seeking to convert the facility to either a hotel or hospital.
The 2007 year-end edition of the permanent tsb House Price Index - compiled in association with the ESRI - reveals that house prices nationally declined by 7.3% in 2007 – compared to an increase in average national prices of 11.8% during 2006.
The index reveals that prices declined more in the second half of the year than in the first with falls in average national prices of 4.7% [second half of year] and 2.6% [first half of year] respectively.
This pattern is in keeping with the trend established in 2006 when the rate of house price growth declined as the year progressed. In that year, average national prices rose 8% in the first half (2006) and by 3.8% in the second half (2006). A year ago it was noted that the rate of growth in the first half of 2006 represented an exceptional outperformance.
The index for 2007 also reveals that the national average cost of houses for First Time Buyers declined by 6.5% during 2007. This was somewhat less of a decline than that experienced for the Second Time Buyer market where the average national price declined by 7.9%.
The average price paid for a house by a First Time Buyer stood at €260,786 at the end of December 2007. This was a decrease of over €18,000 compared to December 2006.
The house price index measures the movement of house prices on a month by month basis. It is prepared bypermanent tsb bank and the ESRI and is considered the most accurate measure of house price movements in the country.
However, the index does not take account of volume/activity in the market which is significantly down, as reflected in stamp duty receipts and mortgage approvals.
Commenting on the results, Niall O’Grady, Head of Marketing at permanent tsb bank said: "After a decade of phenomenal growth, the market finally came off the boil in 2007. However prices today are pretty close to where they were at the start of 2006 and the fundamentals behind the market remain strong – as evidenced by rising rents. There is clearly demand for new houses albeit at reduced levels. The question is at what point buyers will take confidence that we’re at the top of the interest rate cycle and return to buy.”
Looking specifically at December, the price of houses nationally declined by 1.5% during the month, compared to a decline of 1.1% in November.
The average price paid for a house nationally in December 2007 was €287,887, compared to €310,632 recorded in December 2006.
Dublin V Rest of Country:
Dublin house prices fell by 1.4% in December while there was a reduction in prices of 1.0% for houses bought outside Dublin. In November 2007 the relative price changes were -0.1% and -0.8%.
House prices fell by 7.0% and 6.4% in the twelve months to December 2007 in Dublin and Outside Dublin respectively. The equivalent rates in 2006 were growth of 15.9% and 10.9% respectively.
The average price paid for a house in Dublin and outside Dublin in December 2007 was €397,507 and €249,359 respectively. The equivalent prices in December 2006 were €427,343 and €266,339 respectively.
Commuter Counties: - Louth, Meath, Kildare & Wicklow
House prices in the commuter counties of Dublin fell by 0.8% in December 2007, compared to a fall of 0.5% in November. The annual fall in prices in 2007 in the Commuter counties at 6.6% was just below Dublin levels (7.0%). The comparable figure in 2006 was growth of 15.2% for Commuter counties.
The price of a house in the commuter counties in December 2007 was €321,403. This compared to €344,186 in December 2006.
3 Bedroom Semi-detached Houses
3 bed semi-detached house prices fell by 1.4% in December, while in December 2006 they rose by 0.4%.
House prices in this category fell by 4.0% in 2007 compared with a rise of 13.5% in 2006 . The price of a 3 bedroom semi in December 2007 was €o299,412 - down from €o311,906 recorded in December 2006.
First time buyers V. Second time buyers
House prices for first-time and second-time buyers were reduced by 0.3% and 1.6% respectively in December 2007. In November 2007 the equivalent decreases were 0.1% and 1.4%.
House prices fell by 6.5% and 7.9% in 2007 for first-time (FTB) and second-time buyers (STB) respectively. The equivalent price movements in 2006 were + 11.8% and + 12.2% respectively.
The average price paid by a first-time buyer and a second-time buyer in December 2007 was €260,786 and €321,498 respectively. The equivalent prices in December 2006 were €279,003 and €349,213.
New V. Existing Houses
House prices for new and second-hand houses fell by 0.2% each in December 2007. In November the relative price changes were down 0.7% and 1.2% respectively for new and second hand houses.
New and existing house prices declined by 4.1% and 9.0% respectively in 2007. The equivalent movements in 2006 were price increases of 9.6% and 10.2% respectively.
The average price paid for a new house in December 2007 was €290,296 while that paid for a second hand house was €284,608. The equivalent levels in December 2006 were €302,645 and €312,709.