The annual rate of house price inflation continued to ease during the first half of the year, the latest residential market review from property advisors DNG shows, while first time buyers continue to dominate the market.
The annual rate of growth in prices at a national level (excluding Dublin) slowed to 3.4% for the year to June, down from a rate of 7.6% recorded on the DNG National Price Gauge for 2022.
DNG also said the same trend was recorded in the Dublin market, with the estate agents recording an increase in the average price of a resale property of 0.3% in the year to June compared to a rate of 8% the same time last year.
Its Apartment Price Gauge, which measures price movements in the Dublin apartment market, recorded an increase in apartment prices of 0.1% in the year to June 2023, down from a rate of 4.4% last year.
According to DNG, the average price of a resale property nationally (excluding Dublin) rose by 2.3% in the first six months of this year.
This brought the average value of a property to €270,744, up from €264,775 at the end of December 2022.
In Dublin the average price of a home rose by 0.6%, taking the average price of a resale property in Dublin to €522,928 at the end of the second quarter this year. The average price of an apartment in the capital now stands at €358,084.
On a regional basis, today’s figures show that the annual rate of price growth in the year to June was strongest in the West region, with growth of 5%, while the Midlands saw growth of 4.2%.
Below average growth was reported in the South East region with growth of just 1.7%.
Today’s figures also show that first time buyers remain the most active players in the housing market, accounting for one in every two purchases of second hand properties.
DNG said this highlights both the strength of underlying demand from first time buyers keen to own their own home and their willingness to purchase in the second hand market despite several supports targeted at first time buyers of newly built homes.
“The continued lack of affordable property options in the new homes sector for buyers remains part of the issue, meaning first time buyers are seeking out homes in the resale market at the price point and in localities where they wish to reside,” the property advisors added.
DNG Director of Research Paul Murgatroyd said today’s figures confirm that residential property prices across the country are still rising but the pace at which they are doing so has moderated again, suggesting we may well be closer to another peak in the market.
“Affordability continues to be an issue impacting buyers, particularly in Dublin and the Mid-East Regions due to strong price growth in the last two to three years,” he added.
He noted that first time buyers continued to dominate the market for second hand homes in the capital in the first half of the year, buying 50% of all homes sold.
“The changes made to the macroprudential lending rules since the start of the year mean that first time buyers can now borrow four times their income compared to 3.5 times income last year, and this is feeding through into transactions in the resale market,” he added.
DNG CEO Keith Lowe said the residential sales market across the country remained strong in the first six months this year, however today’s figures show further evidence of price stability in the market, with the rate at which prices are increasing continuing to decline slowly which is of course, welcome news for buyers.
“However, anecdotally we have experienced an uptick in enquiries, viewings, bids and purchase prices being achieved, due to competitive bidding in the last few weeks especially at the entry level to the market,” he said.
“This is in part due to a fall in the availability of homes coming for sale, which we estimate to be down 8% this quarter compared to the same period last year,” he added.
Article Source: Rate of house price inflation moderates further as first time buyers dominate – RTE