Daft.ie released their House Price Report for Q4
2020 was a strange year for the housing market. Throughout the second quarter of the year the prices of houses had fallen but come the third quarter of the year they rose back up again and rose a further 2.2% in the final quarter of the year
The average house sale price nationwide in the final quarter of 2020 was €269,522, up from €250,766 a year ago. This is a 7.4% increase for the price of homes from 2019-2020.
Due to Covid-19 the building sector took a hit meaning a fall in the construction of new homes. The total number of properties available to buy on December 1 was less than 15,400, the lowest figure for stock nationally in almost 15 years.
Commenting on the report, its author Ronan Lyons, economist at Trinity College Dublin, said:
“Economic downturns are typically associated with falls in housing prices and thus most economists would have predicted a fall in prices this year, due to the Covid-19 pandemic. However, this downturn is unlike any other in recent memory. While some households have had their entire livelihoods and businesses destroyed, others have been largely unaffected. This can be seen in the surge in household savings that took place, especially in the middle part of the year.
“In other words, housing demand held up remarkably well during the year. The same cannot be said for housing supply. The first lockdown brought construction to a halt, while restrictions throughout the year have taken their toll on the number of second-hand homes put up on the market. The result is that the supply of homes to buy online is at a post-Celtic Tiger low. A normalising of social and economic activity in 2021 will undoubtedly ease the situation somewhat. Nonetheless, the underlying issue remains: a chronic and worsening undersupply of new homes, in a country with strong need for housing over the coming decades.”
Average list price in major cities Q4
Commenting on the report, Raychel O’Connell, Communications Manager at Daft.ie said: “Despite the Covid-19 pandemic the need for housing in Ireland is as strong as ever, and record amounts of property searchers have been visiting Daft this year looking for a new home. With less available properties to buy and prices surging across the country it is good news for anyone considering selling their home. But unfortunately, it’s not welcome information for people looking to buy in the near future”.
This type of information is interesting as it leaves us thinking when the supply does come back will the prices of properties keep rising or will they level back to normal similar to 2019 statistics. We’ll just have to wait and find out.
Full daft report here