Value for money key to new homes sales

New Homes Market:The new homes market is still in the grip of a mini-boom - in sharp contrast to the second-hand market which appears to be experiencing a slow down.

After several weekends of sell-out launches since the season started, a number of agents reported continued brisk sales last weekend.

Douglas Newman Good has sold 220 units at the Paddocks in Adamstown near Lucan since last Wednesday - representing €80 million in sales - where prices for two-bed apartments start at €305,000.

Meanwhile at Clare Village off the Malahide Road, HOK Residential sold around 155 apartments at prices from €260,000 for one-bed units and €320,000 for two-beds.

Hooke & MacDonald also had a good weekend with Carrington at Northwood in Santry Demesne selling 140 apartments off the plans with two-beds from €350,000 to €380,000.

The common denominator seems to be value for money and the feedback from agents is that first-time buyers are the driving force behind sales, snapping up from 60-90 per cent of units at launches.

Ronan O'Driscoll of HOK Residential says that in times "when things are not as buoyant, keen prices are key. When prices are kept reasonable, you can still achieve serious volume sales. It was as busy a launch at Clare Village as I've seen in years."

Keith Lowe of Douglas Newman Good agrees the pricing of units is crucial. "A lot of people have been sitting on the fence but, when they see good value combined with good quality, they will buy in big numbers."

He says the facilities planned for Adamstown - including cinemas, a railway station, crèches and schools - have also been a factor in the development's success.

Of the 10 per cent of purchasers that were not first-time buyers, some were separated and divorced people looking to buy their own place, "a very small number were investors" and a few were trading up from three-bed houses in old Lucan and Leixlip to larger four-bedroom houses.

Ken MacDonald of Hooke & MacDonald says the lack of stamp duty is also a big factor in the popularity of new homes schemes.

"There are a massive number of people still wanting to buy and the quality of new homes coming on stream in terms of insulation and design is so much better than some of the second-hand stuff. Any signs we put up for new developments attract huge interest and straight away our website is clogged up with enquiries."

A certain realism has entered the market which has seen developers price units to sell. They are also more likely to offload units in one go rather than on a phased basis where prices are continually increased.

Keith Lowe reckons that, with prices rising so much in the first six months of the year, the current realism is a good thing. He doesn't see the buoyancy of the new homes market as a temporary phenomenon and reckons that first-time buyers will be able to withstand further interest rate rises.

"Anyone who buys a house has a 2 per cent stress test built in to their mortgage, so they should be able to afford a small increase. The German economy is bad at the moment so I don't think rates are going to go up as much as some people think."