Mayo house prices still sliding
Prices for both three- and four-bed semi-detached houses in Mayo continued to fall in the fourth quarter of 2012, according to the latest MyHome.ie and Daft.ie surveys, both released today (Wednesday).
The trend indicates that it is still a buyers’ market. However, with first-time buyers faced with the abolition of the mortgage interest relief, an ever-tightening lending environment and the added burdens of Budget 2013, that sector’s ability to invest remains compromised. Those already on the ladder could be more reluctant to invest in a higher-end home due to the introduction of the property tax – an expense first time buyers will not have to face for three years.
The Daft.ie report indicates that in Mayo, prices in late 2012 were 20 per cent lower than a year previously, compared to a fall of 13 per cent seen in the year to late 2011. The average home price is now €126,000, according to the report, 52 per cent below peak levels.
According to the MyHome.ie survey, the median price for a four-bed semi-detached house in Mayo dropped by 6.3 per cent in the fourth quarter (Q4), to €150,000, representing a steep annual fall of over 14 per cent. While the fall in median prices for three-bed semis in Q4 was less striking, it was still noteworthy, dropping 4.1 per cent to €139,000 – a drop of 36.8 per cent from the peak.
The rate of decline in property prices nationally increased in the last quarter of 2012, with prices falling by 2.9 per cent – compared with a decline of 2.2 per cent recorded in Q3 – bringing the annual rate of decline to 14.8 per cent.
According to the survey, the mix-adjusted average house price nationally now stands at €201,000, down 51.5 per cent from the peak.
Property Price Register figures reveal that just under 21,000 homes were sold in 2012 – up 15.4 per cent on the 2011 figures, but almost unchanged from the 2010 total.
The author of the MyHome.ie report, Caroline Kelleher from DKM Economic Consultants, said the outlook remains uncertain with further volatility in prices likely in 2013.
“The disposable incomes of prospective buyers will be severely affected in the coming year by the measures announced in Budget 2013 – in particular the introduction of the property tax and the abolition of mortgage interest relief – and this will have a knock on effect on consumer confidence and the ability of individuals and couples to service a mortgage,” she said.
The price of new properties declined by 3.2 per cent in Q4, bringing the annual rate of decline to 9 per cent. The average mix-adjusted price of a new house now stands at €209,000. For second-hand homes, the respective figures were 2.8 per cent, 14.6 per cent and €203,000.
Angela Keegan, Managing Director of MyHome.ie, said that unless the impact of the Budget measures are offset by economic growth, increased employment and a recovery in consumer confidence, the prospects of a recovery in the coming year could be ‘problematic’.
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