House prices in Ireland have increased by 3.8% in the second quarter of 2022, according to new figures released by Daft.ie.
Despite speculation that the soaring cost of living would dampen the market, the cost of buying a property has continued to increase with the average home now costing €311,874.
Prices are currently 9.5% higher than they were this time last year and just 16% below the peak of the market during the Celtic Tiger.
In Dublin prices have shot up by 6.6% but compared to other cities in Ireland that is relatively modest growth; in Cork the cost of buying has gone up by 9.4%, in Limerick city the increase was 11.1%, while in Galway city it was 13% and in Waterford an eye watering 13.5%.
At the beginning of June there were 12,400 homes on the market - up from 10,000 in March.
For economist Ronan Lyons of Trinity College, it is a sign that the market might be about to cool:
“There are some signs that both sides of the market may be turning,” Mr Lyons said.
“On the supply side, the number of homes listed over the last twelve months has increased by 30% since early 2021, although it still remains 15% below the peak in 2019, while construction of new homes is set to reach a post-Celtic Tiger high this year.
“On the demand side, the rise in interest rates, prompted by inflation, will feed through to housing demand in due course.
“At the same time, sentiment among those active in the housing market has eased back, with expected inflation in housing prices over the next year below 1%, compared to over 5% three months ago.
“Expected inflation is one of the key drivers of immediate housing demand, so if prospective buyers feel they have more time to choose, they may take that opportunity.”
Main image: House keys.