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Irish Property Gains Price Traction in April

Posted by: In: Real Estate 02 Jun 2015 Comments: 0 Tags: , , , , , , , , , , ,
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After a the first months of the year saw declines in Ireland’s residential property market suggesting the market was losing momentum, April’s data shows the upward price trend may be resumed.

Nationally, average house prices increased 0.6% during April according to the latest Residential Property Price Index published this week. Dublin, already identified as an investment hot spot for property investors in 2015 by industry experts, buoyed the national figure significantly with a strong 1% rise in its centrally located residential sector.

The new data shows April’s upward price movement follows a small gain in March and declines of 1.4% in January and 0.4% in February. Concerns are mounting that prices will continue rising driven by severe lack of supply which could lead to instability in Ireland’s housing market.

According to the data, April saw national average property prices at 15.9% higher than a year earlier, with Dublin’s prices inflating by 20.2% for the same period.

There are concerns that the bottleneck in supply combined with an improved lending climate and increasing investor interest could lead to the market combusting completely.

Ireland’s economy is in full-recovery mode which is attracting investment from both domestic and foreign sources. Consumer confidence is at its highest since 2006, unemployment is declining and favourable improvements to taxation have resulted in increased disposable incomes; all the dynamics are there to appeal to savvy investors.

Ireland has also seen considerable growth in rents with the data showing that private rents increased a whopping 8.7% year-on-year in April. Again, there are concerns that this will out-price local residents who face limited housing supply across Ireland as it is.

On balance there is much to offer property investors in Ireland , particularly those in dollar denominated countries or with currencies pegged to the dollar, with purchasing power rising as the euro scrapes closer towards parity.

There is also much to be aware of when entering Ireland’s property market, particularly with income-generating assets. Rental growth is great from a landlord’s point of view but only for as long as tenants can afford it. With rental growth massively outstripping wage growth, this is an uncomfortable dynamic for many buy to let investors in the market.

Article by +Roxanne James on behalf of Propertyshowrooms.com

Source:: Property show rooms

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