Is a 2001/02 price good value?


We have been long-term renters for four years, with savings/cash ready for the eventual move. Family circumstances mean we need to move (kids growing up, we need to lock in on schools etc)

We are looking at several houses at present and we believe we can get one for close to a 2001/02 price (which would be less than 50% of the 2006 price).

Is this mad? I’m prepared to deal with a further 10% drop (it’s a family home, not an investment per se) but obviously if things dropped more (30%+) then we could go for a lower loan or a bigger place.

Thoughts? Anyone else in the same situation?



There’s probably another 30% to drop from where we are now, back to 96 or 97 prices, so it might be worth your while to rent for a year and see what your options are then.

I’d be interested to know how much you earn, think you can afford and how big a place and why you want it

When looking back to 2001/2002 you need to factor in general inflation. For most of this decade, Irish inflation was running close to 5% per annum. We’ve just had a year and a bit of deflation but nothing like enough to cancel out 2001-2008.

At a rough calculation (4% compounded until 2008 followed by 5% deflation), you need to increase your 2001 price by 25% to be looking at a 2001 equivalent in today’s money.

I’ve long believed prices around 2001 adjusted for some limited inflation represent fair value. It seems some market clearing prices are around those levels now. Clearly many are still chancing their arms looking for more.

I expect many here will undercut this in their valuations, but I’m of the view that the Irish economy did a lot of maturing (albeit from a low base) from the 90s up to around 2000/2001, which will never be reversed. This brought Ireland into line with similar sized western european economies.

I doubt this very much.

using the esri house price index as a guide ( … _End09.pdf) you could buy a 3-bed semi for 70k in March 96.
That ship has sailed.

any long-term family house bought at '01 prices HAS to represent value.

True current prices -30% won’t bring you to 96/97. Sure price inflation was nearly 30% per annum at stages during 96-2000

In real terms another 30% would leave you close enough to 97.


There’s about 100,000 euros in the difference between June 2001 and June 1997 on the graph for Dublin.

Mortgage would be max 3.25x my salary only (partner not working at present but will return in 3-5 years), there’s no way we’d outgrow it (it’s a big house). Seller keen to move (as far as we can gather) so deal is there to be done.

To be clear - this is a 2001/02 price in nominal terms, not inflation adjusted.