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Property prices in Ireland up almost 15% in last year
Residential property prices in Ireland have increased by almost 15% in the last 12 months, according to the latest data from the Office of National Statistics. In the year to August, residential property prices at a national level, increased by 14.9%, up from 13.4% in July and an increase of 2.8% recorded in the 12 months to August 2013. Residential property prices rose by 2.3% in the month of August. This compares with an increase of 2% recorded in July and an increase of 0.9% recorded in August of last year. A breakdown of the figures shows that in Dublin residential property prices grew by 3.5% in August and were 25.1% higher than a year ago. Dublin house prices rose by 3.5% in the month and were 24.7% higher compared to a year earlier while apartment prices were 32.6% higher when compared with the same month of 2013. However, and ONS spokesman said that it should be noted that the sub-indices for apartments are based on low volumes of observed transactions and consequently suffer from greater volatility than other series. The price of residential properties in the rest of Ireland rose by 0.8% in August compared with an increase of 0.1% in August of last year. Prices were 5.6% higher than in August 2013. House prices in Dublin are now 39.2% lower than at their highest level in early 2007 and apartments in Dublin are 45.8% lower than they were in February 2007. A separate report by Myhome.ie says the average asking price for a home increased by 1.4% nationwide over the last quarter while in Dublin it rose 3%, taking the average asking price to €193,000. It is the sixth quarter in a row that Dublin has recorded an increase and puts the mix adjusted average asking price in the capital at €263,000, up €8,000 in three months. The annual percentage change for Dublin is 9.6%. Caroline Kelleher from DKM Economic Consultants and author of the report said that a supply problem in Dublin is continuing to drive price increases. ‘There were only 500 completions in the capital in the first quarter and given that the Housing Agency has forecast a requirement of 5,700 units in Dublin alone this year it is clear the current rate of completions falls significantly short. As a result our expectation is that prices will continue to rise over the coming months,’ she explained. The report also highlights a growing value gap between Dublin and elsewhere in the country with a semi-detached house in Cork some 66% cheaper than in Dublin. Continue reading
US pending home sales fall slightly, latest NAR data shows
Pending home sales in the United States slowed modestly in August but contract signings remain at their second highest level over the past year, according to the latest data from the National Association of Realtors. All major regions experienced declines except for the West, which rose for the fourth consecutive month, the forward looking pending home sales index also shows. Overall the index fell 1% to 104.7 in August from 105.8 in July, and is now 2.2% below August 2013 when it was 107.1. Despite the slight decline, the index is above 100, considered an average level of contract activity, for the fourth consecutive month and is at the second highest level since last August. Lawrence Yun, NAR chief economist, said that contract signings are holding steady and fewer distressed sales and less investor activity is likely behind August’s modest decline. ‘Fewer distressed homes at bargain prices and the acknowledgement we’re entering a rising interest rate environment likely caused hesitation among investors last month. With investors pulling back, the market is shifting more towards traditional and first time buyers who rely on mortgages to purchase a home,’ he added. According to NAR’s Profile of Home Buyers and Sellers, some 81% of first time buyers in 2013 who financed their purchase obtained a conventional or FHA loan. Overall, first time home buyers have been less prevalent from the housing recovery, representing less than a third of all buyers each month for the past two years. Yun pointed out that first time buyer participation should gradually improve despite tight credit conditions and the inevitable rise in rates. ‘The employment outlook for young adults is brightening and their incomes finally appear to be rising. Jobs and income gains will help repay student debt and better position first time buyers, setting the stage for improved sales growth in upcoming years,’ he explained. The PHSI in the Northeast slipped 3% to 86.5 in August, but is still 1.6% above a year ago. In the Midwest the index fell 2.1% to 102.4 in August, and is 7.6% below August 2013. Pending home sales in the South decreased 1.4% to an index of 117 in August, unchanged from a year ago. The index in the West rose for the fourth consecutive month by 2.6% to 102.1, but still remains 2.6% below August 2013. Existing home sales are expected to be stronger in the second half of the year behind improved inventory conditions, continuously low interest rates and slower price growth. Overall, Yun forecasts existing homes sales to be down 3% this year to 4.94 million, compared to 5.09 million sales of existing homes in 2013. The national median existing home price is projected to grow between 5% and 6% this year and 4% and 5% next year. Continue reading
UK house price fall after 16 monthly rises in a row
UK house prices fell by 0.2% in September, following 16 consecutive monthly price rises but the picture on a quarterly basis is still relatively strong. However, the data from the Nationwide house price index for September clearly shows that the price growth is slowing. It also means that the annual pace of house price growth has fallen to 9.4% from 11% in August. It means the average price of a home is now £188,374 and in the UK as whole, prices are around 2% above their pre-crisis peak. Excluding London they are less than 1% above their 2007 peak. ‘While September saw a slowing in house price growth, the picture on a quarterly basis for July, August and September combined was still relatively strong, with all 13 UK regions recording annual price gains,’ said Robert Gardner, Nationwide's chief economist. ‘There remains significant regional variation however, with the South of England still seeing the strongest rates of growth,’ he added. Gardner said that price growth may soften further in the final quarter of the year, given the high base for comparison from the fourth quarter of 2013. ‘However, the outlook remains uncertain. There have been tentative signs from surveyors and estate agents that buyer demand may be starting to moderate, but the low level of interest rates and strong labour market suggest that underlying demand is likely to remain robust,’ he explained. Nationwide also released its quarterly index for the three months to September which shows that overall prices increased by 1.5%. London is still the most expensive region in the UK with Northern Ireland the cheapest. Prices were up 10.5% compared with the same quarter of 2013 and London did see a slight softening in the annual pace of price growth from 25.8% in the second quarter to 21%. Prices in the capital are now 31% above their 2007 peak, with the price of a typical London property just above £400,000. Annual price growth in Wales slowed from 9.3% to 5.0% while annual price growth in Scotland was similar to last quarter at 5.2%. Northern Ireland saw a 10.2% increase in prices, although they are still nearly 50% below their 2007 peak. Amongst the English regions, the South continued to outperform, with double digit annual growth rates recorded in London, Outer Metropolitan, Outer South East and East Anglia. The North was the weakest English region, with prices up 4.3% over the year. David Newnes, director of Reeds Rains and Your Move estate agents, said that momentum is needed to keep the market going, especially outside of London. ‘Higher LTV lending and the Help to Buy scheme are vital tools to keep firs -time buyers active in areas of the country where the recovery is vulnerable,’ he explained. ‘In London, which sped off of the blocks at the start of the year, the market is composing itself after an energetic few months and we’ve seen house price inflation start to ease back,’ he added. He also warned about the effect of a proposed Mansion… Continue reading
