House Prices to Rise Unless ‘Drastic’ Action Taken

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An Irish property website has warned that house prices in Ireland will continue to rise for the next five to ten years unless drastic action is taken. The figures from the latest Daft.ie house price report show a dramatic increase in prices around Ireland for the second quarter in a row.

In June, the national average price list was 8.8 percent higher than in December. In the whole of 2016, prices rose 8 percent, and by 8.5 percent in 2015. Price increases in 2017 are likely to match or exceed those of 2014 when they grew by 14 percent.

The highest increases are happening in Dublin. In 2014, the value of Dublin homes rose 21 percent, compared to 9 percent in the rest of the country. Annual inflation in Dublin exceeds the rate elsewhere in the country for the first times since the early months of 2015. National prices are up 46 percent from their lowest point. Dublin prices are up 60 percent since the second quarter of 2012.

The least expensive places to buy in Ireland are County Leitrim (€124k) and County Longford (€129k), while the priciest places are South Dublin City (€387k) and South Dublin County (€563k).

Daft.ie’s Martin Clancy asks what has changed. In terms of supply and demand, very little. The country still needs at least 40,000 to 50,000 homes of all types every year. But Ireland only gets a fraction of this – some 3,000 new homes were built by the professional construction industry in 2016. The main focus of policy efforts in the housing market over the last eighteen months, Clancy reports, has been to stimulate demand and prices. What is needed, he says, is a focus on supply and quantities. The country needs 50,000 homes a year to cope with obsolescence, shrinking household sizes, net migration and natural increase. Supply does not meet demand – and hasn’t been doing so since 2011.

The principal reason so few homes are being built is high construction costs. The new Housing Minister, Eoghan Murphy, needs to focus on reducing those costs. “Combined with a strategy for using vacant homes, using land better and reform of housing subsidies, it is entirely possible for this country to have a healthy housing system,” he concludes. Finders Ireland can trace the owners to vacant and derelict properties, helping to ease the housing crisis in the country.

There are tens of thousands of existing, empty properties in Ireland that are both an eyesore in communities and hinder the prospects of housing those in need. If you know of a derelict property in your area, you can report a property on our website here, or phone us on + 353 (0)1 691 7252.

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