First-time buyers are being locked out of the Dublin property market because of escalating house prices in the capital, writes Laura Slattery.
A widening gap between prices in Dublin and those in the rest of the country has pushed property buyers into a burgeoning commuter belt and beyond, according to new figures from Permanent TSB and the Economic and Social Research Institute (ESRI).
Although 29 per cent of the population live in Dublin, only 20 per cent of the homes bought by first-time buyers are in the capital. Of the other 80 per cent, half are in rural areas or small towns. Single borrowers are less likely to buy in Dublin than joint borrowers.
House prices in Dublin have risen almost 300 per cent since 1996. Dublin property prices are now 55 per cent higher on average than those outside Dublin, compared to a difference of 15 per cent nine years ago.
The latest edition of the Permanent TSB/ESRI house price index shows the average Dublin house price is €346,576, compared to €224,938 outside Dublin. In the commuter counties of Louth, Meath, Kildare and Wicklow, the average house price is now €279,268.
The divergence in prices between Dublin and elsewhere was also highlighted in recent official figures published by the Department of the Environment. These showed new homes cost 29 per cent more in Dublin than in the State as a whole, and secondhand homes are 32 per cent dearer in the capital.
An ESRI survey of over 750 people who bought property for the first time in the last three years indicates that people typically spend four years saving an average of €23,000 before they buy. One in five receives a gift from a parent or relative to get on the housing ladder.
The research was conducted before the introduction last month of 100 per cent mortgages, which means first-time buyers no longer have to save for a deposit.
Permanent TSB pointed to a picture of a city increasingly dominated by rental accommodation rather than owner-occupied properties.
Fine Gael spokesman for the environment Fergus O'Dowd TD said this was the first generation of Dubliners who could not afford to live in their own city.
Growth in property market slows to just 2.5%: page 19;
First-time buyers
Average age is 30
Four out of five buy outside Dublin
One in five gets family financial support, averaging €15,000
One in three is a single borrower
One in six in Dublin buys an apartment, but only one in 20 outside Dublin