AVERAGE HOUSE prices in the Republic fell by almost 19 per cent last year to levels not seen since April 2003, according to the latest Permanent TSB/ESRI house price index.
House prices have now fallen by 31.5 per cent since peaking in February 2007. The data published yesterday showed that the pace of property price declines escalated in 2009, with prices tumbling 18.5 per cent over the year compared to a fall of 9.1 per cent in 2008.
The rate at which houses lost their value quickened as 2009 progressed. In the fourth quarter of the year, a national price fall of 8.5 per cent was recorded, more than double the rate of decline in any quarter since the market turned.
Niall O’Grady, general manager of business strategy at Permanent TSB, described 2009 as a “horrendous year” for the Irish housing market.
Factors such as shattered confidence, significant oversupply and a weakening economy created a vicious circle, he said.
“The pessimist will say there’s worse to come. The optimist will argue that affordability has improved so much that things will stabilise soon. But the realist will admit we’ll have to wait and see,” he said.
In a separate report, property website MyHome.ie, which is owned by The Irish TimesLimited, predicted that average asking prices for residential property will decline by a further 10 per cent this year.
The site estimated that prices have fallen by about 25 per cent nationally since peaking.
According to the Permanent TSB/ERSI index, the average national price for a house in December 2009 stood at €213,183, compared to the peak price of €311,078 in February 2007.
