Property prices fell back to 2002 levels in 2010, according to property reports from MyHome.ie and Sherry Fitzgerald.
Prices fell 3.2 per cent in the fourth quarter of 2010, bringing the fall for the year to 13.1 per cent according to the latest Property Barometer issued by property website MryHome.ie
Based on average mix-adjusted asking prices, the average price for a home nationally is now €271,000 compared to €280,000 three months ago and €312,000 12 months ago.
In Dublin, asking prices overall fell by 3.4 per cent bringing the total fall over the last 12 months to just under 15.2 per cent. Prices in the capital have now fallen by 41.2 per cent since their peak. The average asking price for a house in Dublin now stands at €314,000 down from €325,000 in the third quarter and €370,000 twelve months ago.
The latest fall brings the total decline from the peak of the market in late 2006 to 34.6 per cent.
Meanwhile, the latest results from the Sherry FitzGerald index reveal that the average price of a second-hand property in Dublin fell by 4.6 per cent in the final quarter of the year. This reflects an increase in the pace of correction when compared to previous quarters.
The fall of 4.6 per cent in the fourth quarter brings the total drop in Dublin prices in the twelve months to end December to minus 11.6 per cent.
The comparable figures for the national market saw the average price of a second-hand house in Ireland fall by 4.2 per cent in the fourth quarter. This brings the total drop in prices to minus 12.0 per cent during the twelve months to December 2010.
Author of the MyHome.ie report, Annette Hughes of DKM Economic Consultants, said that consumer sentiment remains fragile heading into 2011.
"Although prices are back to 2002 levels it is clear we have not yet reached the bottom of the market. Confidence in the market remains weak as accessing credit remains difficult for some potential house buyers. Other issues which will continue to adversely impact the market include the amount of unsold and vacant housing stock and the precarious financial position of some households following the December budget combined with the need to repay debt" Hughes said.
However Hughes also pointed out that with affordability now back to mid 1990 levels some of those who were priced out of the market during the boom years may be enticed back into the market during 2011. 'There is undoubtedly an overhang of potential buyers waiting to enter the market when conditions improve and confidence is restored. The arguments supporting house purchases as a long term investment decision may once again win out, particularly in good locations' she said.
Angela Keegan of myhome.ie said that while it was clear that 2010 had been a very challenging year for the property market, the decline in asking prices had not been as severe as in 2009.