The number of second-hand or existing homes for sale in the Republic has fallen by 70 per cent over the past decade, according to estate agent Sherry FitzGerald.
In its latest review of the Irish residential market, the company noted there were just 15,500 second-hand properties listed for sale in the State in January.
This represented a 24 per cent fall on the 20,350 properties listed for sale in January last year.
It was also 70 per cent down on the corresponding figure in January 2011, which was 53,000.
Supply levels had been declining by an average of 10 per cent per annum over much of the past decade, the company said.
“However, with the onset of Covid-19, recent falls in supply have been much steeper,” it said, noting that the total volume of properties advertised for sale in January represented just 0.8 per cent of the overall total private housing stock.
Sherry FtizGerald said vendors are reluctant to bring properties to the market amid Covid-19 related concerns but also crucially due to the restrictions on viewings.
“This exacerbation in the supply deficit stoked a rise in house price inflation, particularly in comparison to the more subdued levels of price growth observed in the recent past,” it said.
The company said the average value of second-hand homes in Ireland increased by 1.5 per cent in the opening three months of 2021 and by 2.5 per cent over the past 12 months.
“Akin to last year, the resumption of physical viewings resulted in a notable increase in the supply of second hand-homes to the market and therefore it is anticipated that the supply of property will improve again once restrictions are lifted,” it said.
However, it said the hiatus in construction combined with a big drop-off in the number of residential commencement notices at the start of this year due to the public health restrictions is likely to have a substantial knock-on effect on the total number of houses built.
It projected that only 16,000 new homes would be built this year, down from more than 20,000 last year.