Dublin house prices up 12.3% in year to September

Two-tier property market emerging as prices continue to slide outside the capital

According to the CSO house prices in Dublin house increased by 4.2 per cent in September and by 12.3 per cent over the last year. Photograph: The Irish Times

According to the CSO house prices in Dublin house increased by 4.2 per cent in September and by 12.3 per cent over the last year. Photograph: The Irish Times

Tue, Oct 29, 2013, 15:42

National property prices rose again in September, advancing by 3.6 per cent on an annual basis, up from the 2.8 per cent reported in August. Prices are now growing at their fastest rate since September 2007.

In Dublin, property prices are now 12.3 per cent higher than a year ago, according to CSO’s residential property price index, but the two-tier market continues with prices outside of the capital falling by 2.6 per cent in the year to September.

National property prices rose by 1.8 per cent in September, for the fourth consecutive month, pushing the property index up to 3.6 per cent on an annual basis.

In Dublin, property prices are now 12.3 per cent higher than a year ago, growing by 3.9 per cent in September.

Dublin house prices increased by 4.2 per cent in September, up by 12.2 per cent on September 2012, while apartment prices in the capital also advanced, and are up by 11 per cent on September 2012.

However, the CSO adds the caveat that apartment prices are based on lower transaction levels.

Outside the capital, prices fell by 0.1 per cent in September, matching August’s decline. On an annual prices, prices outside of Dublin fell by 2.6 per cent in the year to September.

Dublin house prices are now 49 per cent lower than their highest level in early 2007, while apartments are 59 per cent lower.

David McNamara of Davy Stockbrokers says that the “stark divergence” between Dublin and the rest of the country “points to a market currently supported by a lack of supply, with an influx of cash buyers compensating for weak mortgage lending”.

“Evidently, cash buyers are attracted by rising rental values, attractive yields and the current perception of property as undervalued,” he said. Cash buyers accounted for 54 per cent of national transactions in Q2 and a similar split looks likely in Q3 according ot Mr McNamara.

Looking ahead, he expects growth rates in Dublin to start to moderate “as some of the big gains at the tail end of 2012 fall out of the annual comparison”. Outside of the capital, he expects prices to fall further “in many oversupplied regions”.

Dublin house prices are now 49 per cent lower than their highest level in early 2007, while apartments are 59 per cent lower.

Outside of Dublin, the price of residential properties is 48 per cent lower than at their peak in 2007.

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