It seems to make no sense. After years when property prices soared because of the easy availability of funds, prices are now rising again because of a lack of supply of properties. And in the capital, first-time buyers are feeling this more than most.
A spokesperson from DNG, sums up the situation in one sharp statistic.
“There are around 3,000 houses and apartments currently for sale in Dublin; normally you’d have about double that,” he says, adding that while there is a steady flow of properties coming on the market, “what’s happening is that they’re selling quickly, so there is little available at any one time.”
DNG says supply is tight all around the city, pointing to a “huge lack of supply in west Dublin”. This, is starting to push prices up in the area, which hasn’t recovered to the same extent as parts of north or south Dublin.
In the city centre, agent Owen Reilly says that the south docklands is “very tight”.
“I don’t see us meeting demand there this year,” he says.
And new home building is unlikely to ease the situation.
While Reilly expects an increase in new homes being built in the capital this year, he says it is from a very low base, and the lack of development finance and difficulties with the planning process, mean that it is unlikely “to be enough to meet demand”.
As a result, first-time buyers are already finding they’re being priced out of that much desired, three-bed semi-detached family house in parts of south Dublin.
“This is what they’re saying, ‘we started looking in Terenure and Templeogue, but we were out-priced and now we’re going out to Knocklyon,’” says the DNG spokesperson.
This change in purchasing habits from houses back to apartments and duplexes is putting pressure on prices in this sector. Indeed he estimates that the price of apartments actually rose by more than houses in the first quarter of this year.
“An apartment we were selling in November for €175,000, we’re now getting between €230,000 and €250,000,” he says.
And the lack of supply means that the ball is in the vendor’s court. So if you do find a home, be wary of bidding past what you can afford in the hope that you can re-negotiate the sale price downwards with the help of your surveyor’s report. One friend who recently bought in Dublin says her surveyor totted up €15,000 worth of essential repairs during the pre-sale survey. But while the buyer was willing to settle for a reduction of around €5,000 on the sale agreed price, none was forthcoming, with the threat being that the vendor would simply put the house back on the market.
