New figures released by the Central Statistics Office (CSO) show that market values in Dublin are rising, but they are staying the same in the rest of the country.
The property price register indicated that in Dublin the market has increased 13.8% over the last year and increased 1.3% in November alone. However, the market was stagnant outside of Dublin last month and is down 0.6% over the last year.
In some parts of Dublin the demand for houses pushed prices up 1.4% in November and by 13.1% in November of last year. Demand for apartments pushed prices up 20.7% in November last year. This number may not be an accurate reflection because few apartments are being bought and sold.
Angela Keegan, who works on property website myhome.ie told the Irish Times about the current situation, “The current level of transactions is far too low. Many people are holding on to their tracker mortgages rather than upsizing and that is acting as a brake on the market. But it’s clear we need to see more new developments coming on-stream.”
The CSO also said that house prices are 47.5% lower than they were at the peak in early 2007.
Property prices are expected to increase by 30% next year due to a shortage of family homes. Prime Minister Enda Kenny announced that the number of family homes being built needed to hover around 25,000 a year, but sources from the construction industry said they would struggle to exceed 8,000 next year. Part of the shortfall is due to the cost of building and lack of access to finance.
The Independent reported Kenny said, “There needs to be a facility for builders to access credit, to develop the sites, build the houses and have a stream of income coming through. There is quite a deal of interest in the commercial sector to improve the sector.”
The government hopes a boost to the construction sector will help meet demands for family homes as opposed to apartments and give a boost the domestic economy.