House prices in Munster expected to rise by seven per cent in next 12 months
Survey conducted of 200 estate agents around the country
Eighty six per cent of SCSI (Society of Chartered Surveyors Ireland) estate agents expect national property prices to increase by an average of 6% over the next 12 months, while a similar number say the main reason for the increase is due to lack of supply.
These are among the key findings of a survey of over 200 estate agents from all over the country, which also revealed a marked regional variation with regard to future price movements.
While agents in Munster and Connacht/Ulster expect prices to increase by 7% over the next 12 months, the figure in Leinster is 6% while in Dublin, where prices are highest, it's 4%.
In cash terms a 7% increase on a €200,000 home outside of Dublin will equate to an increase of €14,000 while a 4% increase on a €400,000 home in Dublin will mean an increase of €16,000.
Agents said the higher price forecast for properties outside Dublin reflected the Covid effect and the increased attractiveness of regional properties due to the dramatic rise in people working from home.
Despite Covid, eight out of ten respondents reported an increase in enquiries and viewings over the last quarter.
The SCSI/Central Bank of Ireland Residential Property Price Survey is a quarterly sentiment survey of SCSI members, consisting mainly of estate agents, auctioneers and surveyors.
TJ Cronin, the president of the SCSI said lack of supply, construction lockdowns and steep increases in the price of materials meant prices would continue to rise.
“We had a supply crisis pre-Covid and that has simply deepened due to Covid. While 45% of respondents in the survey reported a fall in selling instructions in the second quarter of 2021, 81% reported an increase in enquiries. In addition, eight out of ten agents are reporting low stock levels. And that’s why so many agents were seeing a consistent increase in enquiries even during the highest levels of Covid.”
“While prospective sellers were reluctant to put their property on the market, buyers, who in many cases were in a position to increase their savings, were left chasing a reducing number of properties. While it’s a sellers’ market right now, the rate of price increases we are seeing currently is not sustainable in the long term. Agents believe the only way to address the affordability challenge that purchasers are facing is to increase housing supply.”
“Over the last 16 months the construction sector was closed down several times and the cumulative impact of the slowdown on new home construction will be with us until 2023 at least. Significant increases in the price of steel, timber, plastic and insulation products – due to supply chain and transportation issues - and labour shortages across a number of trades will also lead to higher prices for new homes.”