Fast though house prices may be rising in Dublin, prices outside the capital have been rising even faster. A combination of other urban centres playing catch-up and of overspill from greater Dublin into the surrounding counties is driving this demand, according to Ms Claire Byrne, a spokeswoman for Irish Life & Permanent. Recent figures from Irish Life & Permanent show prices in the regions rose by 22.2 per cent in the 12 months to April 2000, as against 16.3 per cent in Dublin city and county.
Department of the Environment figures for the last quarter of 1999 show prospective buyers contend with average new house prices of £163,769 in Dublin, £124,193 in Cork, £117,958 in Galway, £112,432 in Waterford and £102,671 in Limerick.
For second-hand houses, Galway is the most expensive place to buy outside Dublin. These cost £128,686 on average there, followed by £120,075 in Cork, £100,050 for Limerick and £98,569 in Waterford. The average in the capital is £182,095.
This divergence between Dublin and the rest of the State discourages movement to the capital, a positive development in the light of the Irish Academy of Engineering's recent call for a population dispersal policy, focusing on 15 towns. For those who do move to the capital, a salary increase may not compensate for the decrease in quality of life. Mr Mark Giblin, of AIB, recently sold his detached home, moved from Galway to Dublin and is considering a new purchase. "A comparable house could be costing me twice the money when you take it that I was 20 minutes from my place of work," he says.
On the other hand, Tralee auctioneer Eddie Barrett, president of the Irish Auctioneers and Valuers Institute, has seen Dublin couples realise their equity by selling up and buying a guest house in Co Kerry.
"They can get a reasonable semi-retirement type of income out of it," he says.
"We have seen a very good tourism infrastructure come out of that." He is sceptical of the overall benefits of stamp duty changes or property tax on second homes, saying that any gains made by first-time buyers will immediately drive up prices. Punishing property speculators would only increase rents and defer the day when the tenant will be in a position to buy.
Mr Barrett believes hold-ups in the planning process remain a major impediment to releasing house supply.
Limerick remains one of the cheaper urban areas for property, which costs 40 per cent less than in Dublin. Mr Kersten Mehl, a director of Chesser Auctioneers, puts this down to a steady supply of available serviced land and the slower rate of economic growth.
"I think Limerick will continue to grow. The serviced land that is coming on is still steady without being huge. I think Dublin is over-priced. If you look at affordability levels, we would benefit from people relocating here."