MAKE HASTE slowly seems to be the Government’s approach in introducing property market reforms. Belatedly, Minister for Justice Dermot Ahern has announced the introduction of a database to record details of residential and commercial property sales. Currently the sale price of property transactions – excluding those conducted by public auction – cannot legally be published without the assent of buyer and seller. And this is rarely given.
Without price transparency on property sales, the result is an opaque market; prone to rumour and open to possible manipulation. For without up-to-date reliable price data, prospective buyers and sellers are ill-equipped to make informed decisions. The legal ban on publishing property prices stems from constraints under EU privacy law and serves neither the interest of buyer nor seller, nor the public. It greatly adds to uncertainty and risks creating a false market. Other countries have already addressed this issue. In Britain, a change to data protection legislation was introduced to enable publication of property sales prices.
Many questions have been raised by Mr Ahern’s announcement. First, why such a long delay in making it? The adverse impact of the legal ban on publication of property sale prices has been apparent for some time and it has been widely criticised. Last October, the Coalition partners agreed to make this change. And it may yet be some time before the Oireachtas passes the necessary legislative amendments, and before a new agency, the Property Services Regulatory Authority (PSRA) – responsible for publishing property sales prices – is established on a statutory basis.
What remains deeply unsatisfactory, however, is the lack of detail in the Minister’s proposals. How frequently will the property price information be published? Will it be a comprehensive register of all property sales, or merely the average sales price of houses in an area? And will the register be backdated, so enabling trends and movements in property prices to be clearly established.
A property market that is undergoing a huge price adjustment, with the ESRI predicting house prices may fall 50 per cent from their peak, was never in greater need of accurate price information. In 1974, Mr Justice Kenny, in his landmark report on the price of building land, found that it was not possible to compile accurate national statistics for land prices. Some 36 years later, the public awaits right of access to national property sales data.