The latest index from the Irish Economic & Social Research Institute (ESRI) and permanent tsb bank reveals that house prices in Ireland have fallen by almost 2% last month.This brings the prices for residential property back to levels not seen here since the summer of 2004.
On national average house prices have fallen by almost 5% in the first four months of this year.
According to this index, the average price paid for a house in April 2009 was € 248,640, compared with € 261,573 in December and € 311,078 at the peak of the property bubble in February 2007.
Prices for the (usually least expensive) houses in the 'first-time buyer category' are falling at the fastest rate and are down 7.9% already this year.
"This is the fastest rate of decline in national prices that we have seen to date since the index started in 1996," says Niall O'Grady of the permanent tsb bank, one of Ireland's major mortgage lenders.
"The particularly dramatic reduction in prices for first-time buyers reflects their reluctance to buy in a market that is still declining and where unsold properties are being reduced further."
Meanwhile several leading economists and independent analysts are predicting that property prices in Ireland will continue to fall "for at least another 12-18 months".
The Emerald Islander
3 comments:
Given just how high the prices of property in Ireland got over the last 15 years it is clear that we are just starting to see the drop now.
Indeed, Stephen. I fully agree.
And as I mentioned above, many analysts expect a long fall of property prices in Ireland. For me it was clear throughout the whole bubble we had that is was neither real nor sustainable.
And even now, despite all the deflation that has set in, Irish property prices are still way too high and out of all proportion. It is a basic rule of economy that price and value should correspond in a sensible and realistic proportion. (No-one would pay ten Euros for a loaf of bread, even though the bakers might like the idea...)
If one can buy a four-bedroom house in Spain for less than half the money someone wants to charge you for a two-bedroom terraced house in Ireland, then there is something very wrong.
In my opinion the actual value of most Irish houses is still only half of the current prices. If people open their eyes and look a bit around in Europe, they will realise that.
And then all they have to do is to sit and wait until the market forces do the rest.
interesting blog. It would be great if you can provide more details about it. Thanks you
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