Property prices growth rates slow with 4.3% rise in year to February

Residential property prices rose by 4.3 per cent in the 12 months to February, a significantly lower increase than the 12.5 per cent recorded for the same period a year earlier.

The growth rate was the lowest since August 2013, with a softening in demand in Dublin accounting for the deceleration.

Property prices in the capital were up 1.4 per cent on an annual basis, with house prices rising 1.1 per cent and apartments up by 1.8 per cent.

South Dublin recorded the biggest jump in prices with 3.1 per cent. The lowest growth rate was in Dublin city at 0.9 per cent.

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“Ongoing moderation in house price inflation in February is a reflection of the weaker mortgage trends in the second half of 2018. We have seen some pick up in demand early in 2019 but this may take some months to feed through in the context of the increase in stock for sale in Dublin,” said Dermot O’Leary, chief economist at Goodbody.

Outside the capital property prices were 7.5 per cent higher in the year to February, with house prices increasing by 7 per cent and apartments by 14.7 per cent.

The largest increases regionally were in the mid-west, where prices rose by 14.1 per cent. The small increase was in the mid-east at 2.9 per cent.

Trough

According to the Central Statistics Office which compiled the figures, property prices nationally have risen by 81.3 per cent from their trough in early 2013. In Dublin, property prices have increased by 92.8 per cent from their February 2012 low, while prices outside the capital are 77.8 per cent higher than their lowest point in May 2013.

Nationally, property prices are 18.8 per cent lower than their peak in 2007. In Dublin prices are currently 22.1 per cent lower than their lowest level, while in the rest of the Republic, property prices are 22.7 per cent lower.

Alan McQuaid, chief economist at Cantor, said that residential property prices would continue to rise in the near term due to the lack of supply. However, he siad there was now clear evidence that price growth had started to ease, especially in the capital.

“We see house price growth staying in positive territory on a year-on-year basis for a while yet. The biggest rise is likely to come from outside the capital, with the asking price for houses in more expensive areas increasing at a slower rate,” said Mr McQuaid.