Blog post by Owen Reilly, Thursday, September 12th 2017
Low housing stock has continued to be the dominant theme during the third quarter (Q3) and, while the main property portals Daft.ie and Myhome.ie reported just marginal quarterly increases, all agents and reports attested to the price inflation that continues as a result of the shortage of housing for sale. In due course the supply strategies announced in this week’s budget may relieve pressure on the private rental sector and motivate construction and investment however, there was nothing that will increase stock in the short-term.
Strong selling prices with owner occupiers putting it up to investors
A summary of our own sales transactions in Q3 has highlighted an annual increase of 9.17% in the average price agreed in our market area of South Dublin, Dublin’s city-centre and Docklands. The overall average per square meter price that we achieved during Q3 was €6,229 (€579 per square foot). It is clear that home buyers are increasingly active. In Q1 this year, 65% of our buyers were investors; this figure dropped to 59% in Q2 and has dropped to 52% in Q3. Selling times were brisk in Q3 and we saw an average time on the market of 7.6 weeks – dropping to 6.3 weeks in Docklands.
Over-regulation and over-taxation dampens rental sector with rents down
We had hoped that our landlord clients would receive some increased tax relief in the budget by way of compensation for the increasingly onerous regulation of the private rented sector – as undoubtedly the market has been become increasingly unattractive for private landlords. While our average rents agreed are as strong as they can be for our clients, almost 50% of our rents agreed in Q3 were subject to the 2016 rent cap and the average rent we agreed during the quarter was in fact down marginally (0.1%) on 2016 overall and down 3.6% on Q2. Our average rents agreed for Q3 for one, two and three-bed homes across South Dublin, Dublin’s city centre and Docklands were €1,498, €2,145 and €2,717.
While the budget was underwhelming, on the bright side the announcement last week of government plans to facilitate increased building heights is welcome; additionally, the positive impact that the current construction of additional and very high-level Docklands property will have on Docklands and on the city in general cannot be underestimated.
Blog post by Owen Reilly, October 12th 2017