Average price of house rose by 4.3% in first three months of 2017

Fianna Fáil warns that a whole generation may never have the option of home ownership if the Government doesn't take action

Average price of house rose by 4.3% in first three months of 2017

Photo: Eamonn Farrell/RollingNews.ie

House prices rose by an average of 4.3% in the first three months of the year, according to the latest report by property website Daft.ie.

It is the largest increase in two years, and the average price of a house in Ireland is now €230,000.

House prices in Galway and Limerick Cities have risen by 16.3%.

Waterford City prices are up 13.9%, while Cork has seen an increase of 10.7%.

Dublin, meanwhile, has seen a jump of nearly 9%.

The report also notes a continuing decline in the number of properties for sale - the nationwide amount of homes on the market in March was at 20,500, which is the lowest figure since October 2006.

Report author Ronan Lyons highlighted some of the reasons we have seen such an increase in prices.

He explained: "I think what has protected the market over the last few years was the fact there had been an overhang of supply from the bubble years. That was quite small in the urban areas, but it was large in other parts of the country.

"Almost ten years of no building means that there's very little overhang of the kind of properties that people want to buy now in most parts of the country - and that's what's pushing prices up."

He added: “The combined effect of the tweaks to Central Bank mortgage rules and the new help-to-buy scheme has been to significantly stimulate first-time buyer demand. This is seen in renewed house price growth, particularly in and around the major cities."

Responding to the figures, Fianna Fáil warned that a whole generation may never have the option of home ownership without major changes to housing construction and planning rules.

The party's housing, planning & local government spokesperson Barry Cowen argued: “At present, a single person earning the national average salary of €45,042 will be unable to buy a home marketed at the national average of €230,000 based on the traditional 3.5 times salary to loan ratio.

“Unless the Government commits to reducing [the] burden, and also commits to increasing its own construction of public housing, those in the 20s and 30s will never have the option of owning their own home."