The Irish property market has not yet felt the full impact of the Covid-19 crisis, Sherry FitzGerald has warned, as latest data show a smaller number of cash buyers in the market than last year.
"There's no doubt it will have an impact but it's too early to determine what that will be," said Marian Finnegan, managing director of residential and advisory at the company. She also noted that about 55,000 homes changed hands last year.
However, the data do not yet reflect the impact of coronavirus as house sales take a while to complete.
According to recent data, 38 per cent of single property transactions last year didn’t have a mortgage, down from 40 per cent in 2018.
The trend of first-time buyers picking up properties continued into this year, with eight in 10 homes sold by Sherry FitzGerald going to owner occupiers and 53 per cent of those bought by first-time buyers. The data detail how the “prolonged exodus of investors from the market continued uninterrupted in quarter one”.
Investors
"Although in many ways we are in unchartered waters, there are some historical and international reference points which suggest that the market will reactivate, albeit on a reduced level, once the economy reopens," Ms Finnegan said.
“The housing crisis will not have dissipated, so it is essential that every measure is taken to ensure construction activity returns as quickly as possible. It is therefore imperative that policy measures to support viability and affordability of the market are implemented promptly to allow activity levels return to normal,” she said.
Prices
Sherry FitzGerald also examined data for the first quarter noting that prices for properties excluding new builds grew by 0.1 per cent in the three-month period. That compared to 0.2 per cent growth in the comparable period last year. In Dublin, prices were flat in the quarter compared to a 0.1 per cent fall in the same period last year.
Prices were also largely static outside of Dublin. Ms Finnegan also noted it was too early for an assessment of where house prices would go as a result of the crisis.
“It will undoubtedly be a function of not only the length of the period in low-down but also the impact on the labour market. As with previous sharp contractions, we anticipate some supporting policy intervention to assist the market recovery,” she said.
