‘Noticeable slowdown' in viewings of houses in Dublin as average price tag approaches ‘unaffordable' €600,000
Estate agents in Dublin are reporting a marked slowdown in viewers and a lack of interest in homes that are overpriced.
This is happening in tandem with a surge in values in the surrounding commuter counties as a wave of more affluent buyers push out of the city to buy a family home and send values surging in these locations.
The latest Irish Independent/ REA Average House Price Index has revealed that selling prices in Dublin city rose by 2.6pc in the last three months. But there are far fewer first-time buyers, especially at recent viewings.
The average three-bed semi in the capital is now selling at €572,693 – a 9pc annual rise of almost €50,000, while homes in Cork city hit €400,000 for the first time, also pushing the limits of affordability in the southern capital.
The Dublin price represents monthly repayments of almost €2,800 per month over a 25-year term while the Cork city price represents monthly payments of circa €2,000, well beyond what average earners and even above-average earners can afford.
Meanwhile, three-bed, semi-detached homes in the counties surrounding Dublin clocked up the highest inflation nationwide at just over 1pc a month.
They are up 3.1pc in the last three months to €361,319.
The commuter belt increases were particularly felt in Kildare, where Newbridge, Naas, Maynooth and Celbridge all experienced super-inflationary, three-monthly price rises of 5pc.
The REA Average House Price Index concentrates on the sale price of Ireland's typical stock home, the three-bed semi, giving an accurate picture of the second-hand property market in towns and cities countrywide.
The nationwide average price increase in the quarter for three beds was 2.7pc in the past three months, to €347,912. This represents 10.3pc overall annually.
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'Our agents are reporting a noticeable slowdown in viewer numbers in Dublin in the past few weeks, and fewer first-time buyers among them,' said REA spokesperson Seamus Carthy.
'This, coupled with a rise in activity in commuter counties, indicates the price sensitivity of the current market, with buyers maybe hitting an affordability ceiling in some cases.
'And while first-time buyer sales are down 2pc to 45pc in the capital, according to our agents, they have actually risen from 60pc to 68pc in commuter counties.
Meanwhile, homes priced too ambitiously in the capital are simply not getting bids.
'Pricing has become vital, with REA McGee in Tallaght and Rathfarnham reporting that a 10pc variance in asking price can be the difference between a property going sale agreed in weeks or sitting on the market for far longer.'
The average three-bed semi in Kildare is now selling for €444,750, an increase of €21,000 on the March figure, but €130,000 less than the equivalent property in Dublin city.
'We are seeing strong viewer numbers in Kildare, and if homes are priced correctly, they are going sale agreed in four to five weeks, according to REA Brophy Farrell,' says Mr Carthy.
Louth prices increased by €10,000 (3.4pc) in the quarter, a 13pc annual increase, with lack of supply driving residential increases, according to Darina Collins of REA O'Brien Collins.
Homes in Cork city hit €400,000 for the first time as prices in the major cities outside the capital rose by an average of 1.5pc to €360,605 in the last three months – an annual rate of increase of 8pc.
'With the scarcity of stock and falling interest rates, we predict the second-hand market will continue to increase in 2025,' said Michael O'Donoghue of REA O'Donoghue & Clarke, Cork, as prices on Leeside increased by 1.3pc this quarter.
Homes in Galway city rose by €5,000 to €385,000 (1.3pc), while Limerick (€330,000) and Waterford (€327,419) rose by 1.5pc and 2pc respectively.
Homes in the country's large towns continue to show growth nationwide, 2.6pc this quarter and 12pc on last June, to an average of €263,306.
But some towns such as Castlebar and Ennis are reporting unprecedented annual rises of over 24pc due to multiple buyers bidding on scarce properties.
And there were some towns where inflation for three-bed homes went well above the county average.
In Castlebar, prices have risen by 8pc in the last quarter to €265,000, which agents REA McGreal Burke attribute to the extremely low supply, with just 11 properties currently on the market in the entire town.
'What we are seeing repeatedly in our large towns are prices driven by record low supply. In some cases, an extra four or five properties on the market would see more normal sales values achieved,' Mr Carthy said.
'In my own county of Roscommon, supply of desired stock is becoming increasingly low, with demand for ready-to-go family homes at the top of the list,' he added.
'Supply of older stock and refurbishment projects is improving but difficulty securing tradespeople may be dampening purchase desire among some buyers.'
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