Growth in home prices in the third quarter has driven the annual rate of house price inflation in Dublin to 8.4 per cent, according to the latest review of the residential property market by advisers DNG.
DNG has increased its forecast for price growth this year in the Dublin resale market to 9 per cent, having forecast low-single-digit growth for 2024 at the start of the year.
The rate at which house prices are increasing in the capital remained “elevated” in the third quarter of the year, the firm said, with the latest results of the DNG house price gauge showing the average price of a resale home in Dublin rose 2.5 per cent over the last three months. This was on a par with the rate of increase recorded in the second quarter.
The continued increases mean that resale residential house prices in Dublin have climbed 8.4 per cent over the past 12 months, with this rate higher than the 6.4 per cent rise recorded in the year to the end of June 2024.
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The latest growth rate also contrasts with the same period in 2023, when prices rose by just 0.4 per cent for the 12 months to the end of September 2023, DNG said.
Since the market low point in 2012, the average price of a home in the capital has increased 135 per cent, although prices still remain below their 2006 peak. The average price of a resale property in the capital now stands at €570,169.
In the Dublin apartment market, a similar picture emerges, with the DNG apartment price gauge recording a 2.3 per cent increase in apartment values in the third quarter, signifying an acceleration in the rate of growth compared with the first and second quarters of 2024.
The average price of an apartment in the capital has increased by 6.2 per cent over the past year. In the previous 12 months, the average price fell by 0.1 per cent.
During the third quarter, first-time buyers accounted for just over half (52 per cent) of purchases of resale properties in the capital, an analysis of DNG purchasers found. A further 19 per cent of buyers were doing so in order to trade up in the market, while only 8 per cent were buying in order to trade down in the market.
“It’s unsurprising that residential prices continue to rise given the dearth of supply available in the resale market since the start of the year,” DNG director of research Paul Murgatroyd said.
“There is simply not enough existing housing stock available for sales to satisfy the level of demand in the market, meaning that buyers, especially first-time buyers who have loan approval, are unable to find a home to buy such is the competitiveness in the market at the present time.”
DNG chief executive Keith Lowe said the shortage of supply in the second-hand market, combined with “robust” demand, continued to push up prices in Dublin.
“Our research shows that in the third quarter of the year sales were being agreed at 8 per cent above the asking price on average, so it is little surprise that the DNG HPG recorded another strong quarter of price growth in the three months to September.”
There have been indications of a slight increase in supply in recent weeks, however, he added, with DNG research pointing to a 12 per cent increase in available second-hand stock for sale since July 1st.
“Nonetheless, by historical standards the volume of properties for sale, at approximately 3,900 units, is far short of the volume needed to satisfy current demand.”
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