Advertisement

House price inflation set to slow next year

A new property price survey has suggested that while house prices will continue to increase natio...
Newstalk
Newstalk

08.04 8 Nov 2018


Share this article


House price inflation set to s...

House price inflation set to slow next year

Newstalk
Newstalk

08.04 8 Nov 2018


Share this article


A new property price survey has suggested that while house prices will continue to increase nationally, this pace of increase will slow.

The Chartered Surveyors Ireland/Central Bank of Ireland Housing Market Survey says 59% of estate agents expect house prices to increase nationally in the next 12 months - down from 78% in the second quarter.

But the anticipated national increase over the next 12 months has fallen from 5% to 2%.

Advertisement

While a predicted national increase over the next three years has also dropped from 8% to 5%

This is the third survey in a row in which the predicted rate of price inflation has eased.

In Dublin, price expectations have actually increased from 2% to 3% - but have also fallen to 5% over the next three years.

It says this was down to a number of factors - specifically the perception of value and Brexit.

In Dublin, respondents viewed the construction of new units and the Central Bank's mortgage measures as the main factors for their views.

Asking prices 'set too high'

Estate agent John O'Sullivan said it was clear from the survey that affordability is now impacting house price inflation - and as a result the rate of inflation is moderating.

"The cost of accommodation whether as a purchaser or tenant is the single biggest challenge faced by those in areas of high demand.

"While price inflation has waned for high value property it's likely that it will also slow for other property classes over the short term.

"That said the entry level, where demand is very high, is the most active and the least impacted."

"The main reason the rate of inflation is slowing is due to an increase in supply which is down to new developments coming on stream and as mentioned in the survey, the number of buy to lets being offered to the market as landlords continue to exit the rental market."

He also said another factor was that, in some cases, asking prices have been set too high.

"If prices are pushed beyond buyers' ability to pay, it's inevitable prices will come back.

"That said the market is reasonably active and one of the main challenges the sector faces is the time it takes to close a sale due to the protracted legal process."

Agents report that for every three investors selling, only one investor is buying - which is not seen as good news for the rental market.


Share this article


Read more about

News

Most Popular