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Irish Property Market
bank lending returns
Irish house prices are still falling and worse, they are falling faster. According to official data from the central statistics office residential property prices in Ireland were down by 17.8% year on year in February and by 2.2% on the month. This is compared to year on year fall of 17.4% in January, when prices were down by 1.7% compared to December, showing an accelerating rate of decline.
Unsurprisingly Dublin is still falling fastest. According to the data property prices in the capital fell by 20.3% over the year, whereas prices in the rest of the country fell by 16.4% over the year. However, there was finally an indication that the picture in Dublin may be improving; Dublin property prices were down just 1.2% on the month in February, while prices in the rest of the country fell by 3% over the month.
Never the less house prices in Dublin are now 56% below the peak and apartments in the capital are now worth 62% less than at the peak.
"Tentative signs of a stabilisation in prices in this category that began to emerge in November 2011 have now been completely reversed as the annual rate accelerated to minus 23 per cent, the fastest rate since February 2010," Goodbody economist Juliet Tennent said.
"The bottom line is that consumers will want to see the housing market stabilising before they feel confident about the economy overall, but we think prices have further to fall," said Bloxham’s chief economist Alan McQuaid.
McQuaid went on to say: "We don't see any significant improvement in the housing market until the employment situation gets better and bank lending returns to some sort of 'normality', which is still some way off in our view". He predicts a double digit decline of around 10% for this year.
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