House prices are now rising by an average of €4,000 a month, according to property website MyHome.ie.
The average monthly jump in values recorded on newly listed properties over the last six months was more than double that registered by rival website Daft.ie in a similar report last week.
The disparity may reflect MyHome’s greater concentration on properties in Dublin, where the average monthly price hike was put at more than €5,000.
In its latest quarterly report, the website, which is owned by The Irish Times, also warned of a possible "rush in transactions" ahead of the likely abolition of the Government's Help-to-Buy scheme in the budget as first-time buyers move to avail of the incentive before it is phased out.
Upswing in prices
The scheme, which provides prospective buyers with tax rebates of up to €20,000 on the purchase of new homes, has been cited as a factor in the current upswing in prices.
MyHome’s report, produced in conjunction with stockbroking firm Davy, suggested property prices nationally rose by 5 per cent in the second quarter of the year and were up 8.9 per cent year-on-year. In Dublin, prices rose by a slower 2.8 per cent in the quarter but were up 10.3 per cent on an annual basis.
The average asking price nationally for a three-bed semi-detached house was put at €251,500, an increase of €24,000 in the last six months. The corresponding figure for Dublin was €360,000, an increase of €32,000 on six months ago.
The report's author, Davy economist Conall MacCoille, said house price inflation in Ireland was being driven by robust jobs growth, rising incomes and competition among homebuyers, which was leading to "more highly leveraged mortgage lending".
He said the Government’s Help-to-Buy scheme had contributed to the pick-up in inflation, with the prices of newly built homes now rising faster than those for older dwellings.
A significant jump in new lending to first-time buyers on foot of the Central Bank’s decision to relax its mortgage lending rules was also viewed as a factor.
Jump on board
Mr MacCoille predicts the likely demise of Help-to-Buy in the upcoming budget may lead to a rush of transactions in 2017 as first-time buyers jump on board and to a slowdown in price rises in 2018 as it is phased out.
He also noted that with 7,275 Help-to-Buy applications received so far and the average tax rebate paid out totalling €15,000 - or 5 per cent of a €300,000 home - the Government’s initial estimate that the scheme would cost €50 million seems way off the mark. Even if no more applications were received, those already in the system would cost Revenue close to €110 million based on the €15,000 average rebate.
MyHome.ie managing director Angela Keegan said the continuing tightness of the housing supply situation means houses are being snapped up ever more quickly by desperate buyers and that competition for properties will intensify through 2017.
Prices exceeding €1 million
A new feature in MyHome’s latest report was an analysis of the sales of homes at prices exceeding €1 million. Last year it found there were 638 such transactions, which was four times greater than the 160 recorded in 2011.
Some 547 of these transactions were in Dublin, with Cork recording 21, Wicklow 18 and Galway 12.
Within Dublin, the vast majority of the homes sold for €1 million were on the south side of the city, with Dublin 4 accounting for 20 per cent, or 136, of the national total. Dublin 6, which comprises the plush suburbs of Rathmines, Ranelagh and Rathgar, had 100 €1 million plus transactions, while Dublin 18, which includes the Foxrock area, had 44, Blackrock had 39, Dalkey and Killiney had 36 and Dublin 14 had 28.
North County Dublin saw 20 transactions exceeding €1 million in areas such as Howth, Malahide and Kinsealy. Clontarf also had nine properties that secured more than €1 million.
MyHome says it currently has 545 homes on its books with asking prices in excess of €1 million. A further 221 million-euro homes have agreed sales in recent months, according to its data.