Cash buyers accounted for little more than one in three purchases in the property market in the second quarter of 2014, down from 50 per cent the previous quarter.
The finding, which was made in the Society of Chartered Surveyors Ireland (SCSI’s) first Housing Market Report, would indicate that the level of cash transactions is beginning to moderate as mortgage availability is improving.
According to the report, which is based on a survey of property professionals across the country, the pace of sales activity levels in the property market (sales enquiries, sales agreed and sales completed) increased in the second quarter of the year. About 22 per cent of units covered in the report were purchased as buy to let or investment properties.
Simon Stokes, chair of the residential property group of the SCSI said that the increased sales activity levels identified in the report and the re-emergence of investors suggested an improvement in confidence in the property market. However he warned that the lack of supply, especially in Dublin, remained a key issue.
“Ninety per cent of respondents in Dublin believe there is a greater demand for housing than supply and 70 per cent believe that demand will continue to outstrip supply in Dublin in 12 months time. We urgently need more homes to be built and the Society recently called for a number of measures to increase the supply of new homes including a Builders Finance Fund to help small builders access development finance, a 2 year reduction in VAT on new homes to 5 per cent and a reduction in development contributions.”
With respect to prices, the survey shows that ninety per cent of respondents believe average national house prices will be higher in 12 months time, with one in three asserting that they will rise by 5 per cent. An even higher figure, 97 per cent, believe Dublin house prices will rise over the same period, one in four saying they will be 10 per cent higher.