|
Last Updated:
Apr 24, 2009 - 5:31:05 PM |
 |
| The average price paid for a house nationally at the end of 2008 was €261,573. This compares to €287,887 at the end of 2007 and €310,632 at the end of 2006.
|
- Prices nationally declined by 9.1% compared to fall of 7.3% in 2007
- Prices fall furthest in Commuter Counties around Dublin – down 16.8% in the year
- Prices for First Time Buyers down 14%
The 2008 year-end edition of thepermanent tsb House Price Index - compiled in association with the ESRI - reveals that average house prices nationally declined by 9.1% in 2008 compared to a drop of 7.3% in 2007. If you take account of inflation during 2008 [4.1%], this is equivalent to a decline in real prices of 13.2% in the year.
The average price paid for a house nationally at the end of 2008 was €261,573. This compares to €287,887 at the end of 2007 and €310,632 at the end of 2006.
The 2008 index reveals that prices declined by broadly similar rates in the first and second half of the year [H1 = -4.8%. H2 = -4.3%].
Within the different categories, the end of year analysis highlights how average prices in the commuter counties around Dublin [Wicklow, Kildare, Meath and Louth] fell by 16.8% - during the year. This was the largest fall of any category and compares to a decline in average prices in Dublin of 11.7% and of 10.2% for houses outside Dublin.
The index for 2008 also reveals that the national average cost of houses for First Time Buyers declined by 14.0% during 2008 – compared to a decline of just 6.5% during 2007. This was significantly more than the decline of 7.8% seen by Second Time Buyers during the year [2007: 7.9%]
The average price paid for a house by a First Time Buyer stood at € 224,153 in December 2008 compared to €260,786 at December 2007.
Commenting on the results, Niall O’Grady, General Manager Business Strategy at permanent tsb said: "Some people will point out examples where declines in prices have been significantly ahead of the figures we’re reporting here but what we and the ESRI are providing is an objective measurement of real average prices actually secured for house sales across the country. The message is clear; after a decade of exceptional growth, we’ve entered a period of retrenchment in house prices and while the impact is being felt everywhere, there are certain areas [such as Commuter Counties] where the pressure has been particularly intense.”
“Looking forward while it’s hard to speculate over a year long period, we don’t expect any significant change in the established pattern of this year and are guiding therefore to a further decline in average national prices in the order of 10% during 2009 with some significant variations to that in different areas.”
The index does not take account of volume/activity in the market which is significantly down, as reflected in stamp duty receipts and mortgage approvals.
Methodology
Dermot O'Leary, Chief Economist of Goodbody Stockbrokers, said in November 2007, that three reasons can be cited for a discrepancy between its expectations of house price falls and the permanent tsb / ESRI House Price Index. Firstly, the data are reflective of prices at the mortgage payment stage of the house-buying process. This can be some 3-4 months after a sales price is agreed, and, in a slower market, this lag could get extended further. Therefore, there is a significant lag between market prices and the official house price data. Secondly, the type of properties in the ptsb database may be concentrated towards the lower price range in the market. Whiler ecognising the fact that the ptsb data takes account of the different characteristics of the house, the average price in the country is well below the estimates contained in the dataset from the Department of the Environment. Finally, price incentives, which have become common for new scheme developments, would not get reflected in the data.
US Data: S&P/Case-Shiller Home Price Indices: US home prices continued to decline in November; Annual falls of 32.9% in Phoenix; 30.8% in San Francisco and 28.7% in Miami
December Figures
Looking specifically at December 2008, the price of houses nationally declined by 0.9% during the month, compared to a decline of 0.5% in November.
The average price paid for a house nationally in December 2008 was €261,573 compared to €264,026 recorded in November.
Dublin V Rest of Country
Dublin house prices fell by 2.1% in December while there was a reduction in prices of 0.7% for houses bought outside Dublin. In November the relative price changes were -0.8% and -0.1%. The average price paid for a house in Dublin and outside Dublin in December 2008 was €351,096 and €223,984 respectively.
Commuter Counties: - Louth, Meath, Kildare & Wicklow
House prices in the commuter counties of Dublin fell by 4.5% in December 2008, compared to a fall of 2.4% in November. The price of a house in the commuter counties in December 2008 was €267,265. This compared to €280,003 in November.
3 Bedroom Semi-detached Houses
3 bed semi-detached house prices fell by 2.7% in December, while in November they fell by 2.6%%. The price of a 3 bedroom semi in December 2008 was €267,731 - down from €275,093 in November..
First time buyers V. Second time buyers
House prices for first-time and second-time buyers were reduced by 2.6% and 0.4% respectively in December. In November the equivalent decreases were 1.9% and 0.1%.
The average price paid by a first-time buyer and a second-time buyer in December 2008 was €224,153 and €296,302 respectively. The equivalent prices in November were €230,094 and €297,562.
New V. Existing Houses
House prices for new and second-hand houses fell by 0.7% and 1.4% respectively in December. In November the relative price changes were down 0.1% and 1.2% respectively for new and second hand houses.
The average price paid for a new house in December 2007 was €266,466 while that paid for a second hand house was €256,956. The equivalent levels in December 2007 were €290,296 and €284,608.
