While I admit I know very little about property or economics, I found the above article surprising in that some elements are counter intuitive:
“Home prices in Dublin have been more severely affected, falling by 3.1 per cent last month and 17.5 per cent over the year. House prices in the capital dipped by 3.2 per cent in the month, while apartment prices were 2.3 per cent lower.”
Firstly, I am sure I read here that Dublin prices (as a whole) may stabilise before other areas, for example, new estates on the commuter belt, so why does it show a greater fall? Also, why would Dublin apartments fall less than houses? I assumed most FFBs would buy a house, as a potential forever home, and thus house prices would stabilise before apartments. (Overall apartments fell by more but not in Dublin). IS this simply based on fluctuations in the quality of the stock which means that you can’t really look at prices month by month, or could there be some underlying reason?
And why, with a 15% fall, and with the speed accelerating from last year, do Reuters and Bloxham think next year will be a 6-9% drop? (If house prices only fell by 6% next year I think I would put on my First Time Buyers hat and be ready to pounce!!)
I would strongly encourage you to have a look through the actual CSO report itself. Short term volitility does explain some of the things you highlight above (page 19 of the report itself warns of not reading too much into individual one month price changes).
I’m also slightly bemused as to why Dublin property prices are fallinig faster than the rest of the country - you could possibly argue that since Dublin property is more expensive than elsewhere, the tightening of mortgage lending criteria is hitting harder - but I know there are plenty of counter arguments and since I really don’t know what I’m talking about on this I’ll stop now.
I think I picked up that the CSO stats are based on mortgages. I’ve been told by two EAs in the last week that virtually all sales are pure cash; which implies that the statistical base is unreliable. What’s not clear is whether it is under or overstating the drop.
The simple view I have is that house prices continue to fall because they are still too expensive
What I haven’t figured out is how I’ll know when they are not too expensive or even better if I reckon they are cheap. I’m trying to compare €/M with international prices but its pretty difficult to compare apples with apples.
I think people have to be very careful about what the percentages actually mean, particularly when the scale of the crash is referenced to the peak valuations. Also, Bloxham have a very poor record of predicting the direction of house price trends let alone the scale.
Same here. I want to buy a house (I am one of the people with an idealistic view of home ownership!) but I really think house asking prices in some Dublin areas are still extortionate.
Morgan Kelly said a 60% drop, up to 80% in some places I think, so I would assume that the 80% would only be less than desirable areas! Until the property price database next year , we don’t really know the true %, but based on allsop etc, which a lot of pinners seem to think is a good reflection of the market value, we are already between 60 and 80%, so even based on MKs predications prices could level off next year, or at least the rate of decline slow down?