Close to half of homebuyers say they will not wait for promised lower interest rates before buying a home amid continuing concerns about supply, according to property website MyHome.ie.
The European Central Bank has clearly signalled it will cut interest rates for the first time in over 8½ years when it holds its next meeting in June.
The bank expects to cut rates several times over the following year or so after a record 10 successive increases in the 15 months to September last year that pushed rates to a level not seen in a quarter of a century.
However, 45 per cent of those responding to the MyHome.ie survey said they would not delay a home purchase to wait for lower mortgage interest rates.
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A prevailing view that property prices will increase over the next 12 months may be a factor in that decision. So too might be a level of frustration, with roughly the same number saying they had to delay plans to buy a home because of the cost-of-living crisis.
Close to two-thirds of the 2,233 people responding to the survey said they had finances in place to purchase a home but only one in five believes there are enough properties available on the market to allow them buy a home that suits their needs.
Seventy-eight per cent of respondents said they were worried about the state of the market in general with just one in 20 people believing the Government is doing enough to help the property market. Over a third of those engaging with the survey said a change of Government would be a good thing for the market.
MyHome.ie conducted the survey online between April 26th and May 1st. All registered users of the site were invited to participate, as were casual visitors. The company, which is owned by The Irish Times, also invited participation via social media posts.
Just 13 per cent believe the next year will be a good time to buy a home with 78 per cent saying the limited supply of homes means they are having to look beyond their top location choice as a result.
Of those currently seeking mortgages, close to six in 10 say they want to lock in for a five-year fixed term despite the general expectation of lower mortgage rates over that period. Fixed-term mortgages continue to be the preferred option, with almost three-quarters of potential buyers not prepared to opt for a variable rate home loan in expectation of further rate cuts.
MyHome.ie managing director Joanne Geary said it was striking that, despite the negative outlook about the market in general, strong demand was so clearly in evidence.
“On the one hand, very few people believe that the next year will be a good time to buy and most are worried about the state of the market,” she said. “On the other hand, nearly two thirds of respondents are financed and ready to go, and almost half of people won’t even wait for an interest-rate cut to buy.”
Ms Geary said only sustained homebuilding would lead to a meaningful improvement in property market sentiment.
“If the Government can facilitate a decent period of uninterrupted construction activity, this would make a huge difference around the country and sentiment would likely improve as a result,” she said.
“Taoiseach Simon Harris has pledged to build 250,000 homes by 2030, but after a decade of insufficient construction activity, it is perhaps understandable that people are wary of the Government’s promise to deliver the amount of new homes we need to properly address our supply issues.”
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