The latest house price data from Myhome.ie indicates price growth in the sector is slowing as against beginning to decline, according to economist Conall MacCoille.
This is because the asking price for properties put on sale on the website in the first quarter of this year show a “bounce back” after the same data in the final quarter of last year showed a decline.
The decline in the final quarter of last year was subsequently reflected in the Central Statistics Office data on actual sales in the first two months of this year, which recorded falls in prices.
On this basis, Mr MacCoille said, the increases recorded in the asking price of homes new to the website in the first three months of this year will feed through into the CSO data on actual sales later this year.
The moderation in house price inflation is a positive development and does not mark a period of sustained price decline, the Davy economist said.
Mix-adjusted price
The latest data from Myhome.ie, which is owned by The Irish Times, showed the mix-adjusted asking price for all listed houses rose by 2.2 per cent in the first three months of the year, and 5.7 per cent year-on-year.
The comparable figures for Dublin were 2.5 per cent and 12.7 per cent.
The mix-adjusted national asking price for a house is €198,000, while the same figure for Dublin is €276,000.
For houses new to the website during the first quarter, the median price nationally rose 6.3 per cent, to €169,000, while the comparable figures for Dublin were 1.4 per cent and €299,000.
“A mix of factors probably explains the recent moderation in house price growth,” said Mr MacCoille, who wrote a report on the latest data.
‘Affordability stretched’
“First of all, affordability was becoming stretched in Dublin. Secondly, the Central Bank’s new lending rules may have reined in exuberant price expectations.
“Thirdly, the end of capital gains tax exemptions may have inflated demand mid-year, leading to price falls towards the end of last year.”
Angela Keegan of Myhome.ie said the property price register indicates that property sales in the first two months were up 44 per cent on the same period last year.
However, the level of sales was still far below the average expected in a normal functioning market.
She said the moderate price growth now being recorded is positive for the longer term sustainability of the market.
