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THE PRICE of the average apartment in Dublin fell by 6.3 per cent last month – and is now just 38 per cent of its price at the peak of the property bubble, new figures have shown.
The Central Statistics Office’s residential property price index showed that the price of the average Irish home fell by 2.2 per cent in February.
Prices have now fallen by an average of 17.8 per cent in the last 12 months – the fastest rate of annual decline since the end of 2009. The monthly drop is equal to that of last October, which itself was the steepest drop in a single month since March 2009.
Apartments in Dublin saw the most dramatic drop, with prices down by 6.3 per cent in just 12 months, confirming a return to declining prices after their values rose in November and December of last year.
Apartments in the capital are now worth 22.9 per cent less than they were at this point last year, and have seen prices plummet by 62 per cent since the peak of the market in February 2007.
Properties outside of Dublin also had a torrid month, with values falling by 3 per cent – double the rate of decline they had experienced in February 2011.
Those prices are now down by an average of 16.4 per cent in a year, and by 45 per cent from their peak prices in 2007.
Houses in the capital fell by a comparatively modest 0.7 per cent, and are down by 20.2 per cent in the last 12 months. The value of those homes is now an average of 56 per cent lower than their peak in early 2007.
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While it’s terrible for a lot of people who are in negative equity, there are probably a few of us out there (myself included) who would be looking to buy in the next few years and are delighted to see the continued drop! #silverlining
It’s a two way street though as its tougher to get funding for houses. Best of luck though it’s a great feeling to walk in your own front door.
It being tougher to obtain credit is not necessarily a bad thing. People should have to save a reasonable deposit to buy a house. There remains a tendency to view access to credit as some type of right or entitlement, which it is not.
Higher borrowings suit banks, not people.
I think there is still another few years of drops, if you consider the avg industrial wage is 34k and a sensible lending policy should be 2.5 times wages that give 85k so I think prices will fall until avg for a one bed in Dublin city is 85k. At present they are about 110k so I believe prices will fall quite a bit more.
At least another 25% to go! An average 3 bed semi in Dublin will come down to around 130k in the next 18 months! Only then will the market settle down!
3 times average isnt outside the international norms but should not be compared against 1 beds 2 beds would be a more sensible comparison- so 2 bed should be around the 100k mark.
Question is should someone on an average income buy? The norm outside Ireland is someone on an average wage would rent.
@mike – figure may be a tad low there- a €130,000k house would mean a €110,000 mortgage which would be about €600/month which would put them within the range of 1st time single buyers on 34k, families with joint incomes would push the value of these upwards as demand increased as they are in relatively limited supply within Dublin due to most people not being in a position to move and not too many houses within the city limits are vacant. In Dublin suburbs the drops have stabilised somewhat for 3-4 bed semis when compared to apartments. Apartments are still in free fall there is no foreseeable limit to the supply of vacant units.
There are already one bed apartments in Dublin city center for 80, 000 euro (so presumably the negotiated prices are even lower than that)…
Will people stop harping back to the price at the peek. They are gone deal with the here and now. Peek prices were ridiculous, why do we measure our present situation off that.
I agree with Barry. Let’s not worry about a peek, or even a look-in. If you’ve got a peeking problem, get curtains!
Like it or not, It puts the prices in perspective. We could have done with some of that during the boom times.
Must write out “peak” 100 times :(
Donal, we did have it in the boom times. The %’s went up in double digits year on year and we were all rich. That was unrealistic and so is this.
They were only ever worth 38% of their peak price! If that.
Wow, 38%! I would sell my apartment today if that was true. Sadly it’s not. More like 58%. Stuck in an apartment for a long time?
article says they’re worth 38% of their peek, not down 38%!! ;-)
There is still loads of high property prices & no value for money out there in property at the moment….high property prices is what killing this country and whats holding it back.
It will bottom out around 80% and then stabilise for a good long time, so there is a few more years of drops to go. Listen to the people who know and dont have there own vested interests looking after there back pockets and rubbish investments which is most of the people in high paid jobs like the media. Loads of good property sites with very good advice. Rule number 1…. DO NOT LISTEN TO THE MEDIA!
I mean 130,000 euros given an annual rental of 10,000…it’s been a long day on the perch :-(
In the US the “real” price of a property is calculated at about 13 times the annual rent. So if your apartment will bring in (say) 10,000 euros per annum, it’s worth about 140,000 euros (or should be, when/if things stabilise in the property market).
That seems to be a reasonable formula, from what I know of rents and property values in other European countries.
By the way, we are now more-or-less on a par with the norm in comparable countries like Germany, as best I can make it out. So my guess is that values won’t fall much further, but they won’t rise for a long time either.
Oops…that should have been 130,000 euros per annum, of course…
Please blow another bubble please!!!!
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