The price of homes across the State climbed by over 6 per cent last year with Dublin outperforming the market considerably by recording price increases of nearly 16 per cent, according to the latest set of figures from the Central Statistics Office (CSO).
The national average residential property price increase for the 12 months to the end of December was put at 6.4 per cent compared with a year-on-year increase of 5.6 per cent to the end of the previous month and a decrease of 4.5 per cent recorded in 2012.
In December residential property prices in the capital grew by 0.3 per cent compared to an increase of 0.6 per cent recorded in November and a decrease of 0.5 per cent in the same month last year.
Broken down by category, house prices in Dublin were 15.3 per cent higher in December compared to a year earlier while apartment prices were 20.8 per cent higher when compared with the same month in 2012.
The CSO cautioned that the apartment figures were based on low volumes of transactions and consequently suffer from greater volatility than other series.
The price of residential properties outside Dublin rose by 0.1 per cent in December compared with no change in December of 2012.
House prices in Dublin are now 47.4 per cent lower than they were at their highest level in early 2007. The price of apartments in the city have fallen by 54.5 per cent since the height of the boom in February 2007.
The fall in the price of residential properties across the rest of the State is somewhat lower and the CSO put the decline at 46.8 per cent. Overall, the national index shows that residential property prices have fallen by 46.4 per cent since 2007.
A spokesman for the estate agents Savills warned that the price increases would continue in Dublin until supply met demand. “At the moment this is not happening for a number of reasons, such as planning barriers set down by some development authorities and the restricted availability of development finance,” Savill’s head of residential Graham Murray said.
Meanwhile, the rebound in Irish property will weaken next year as tight credit conditions and mortgage arrears exert a downward pressure on prices, according to rating agency Standard and Poor’s (S&P).
The rating agency’s somewhat sober assessment of the market comes amid a raft of positive data relating to the sector. It predicts house prices will rise nationally by 3.5 per cent this year which is in line with several recent industry predictions.
Improvement in the economy and employment, in tandem with a supply constraint in Dublin, will help drive recovery in the housing market in 2014, it said. However, it predicted the acceleration in prices will slip back to 2 per cent in 2015 because of the prevailing credit climate and the ongoing problem of mortgage arrears.
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