House prices up by a minuscule 0.9% y-o-y in Q2 2019
Ireland’s house price growth is decelerating rapidly, amidst the uncertainty surrounding the Brexit. Residential property prices increased by a meagre 0.9% during the year to Q2 2019, a sharp slowdown from a y-o-y rise of 11.46% a year earlier. In fact, it was the lowest growth since Q2 2013. During the latest quarter, Irish house prices increased by 0.35%.
Demand is now falling but supply continues to rise
In the first half of 2019, the total number of market-based household purchases of residential dwelling fell by 7.8% to 17,873 units from a year earlier, according to Ireland’s Central Statistics Office. Similarly, sales value dropped 6.9% y-o-y to €5.17 billion in H1 2019. In Dublin, the number of sales dropped 9.2% while sales value fell by 12.2% over the same period.
New dwelling completions surged by 16.8% to 9,185 units in H1 2019 from a year earlier.
Rents, rental yields: excellent yields at 7.18%
Dublin apartment costs are around €2,354 per sq. m.
|Ireland: typical city centre apartment buying price, monthly rent (120 sq. m)|
|Buying price||Rate per month||Yield|
|Dublin||€ 282,451||€ 1,690||7.18%|
Recent news: The Irish economy grew by about 6.7% in 2018, after GDP growth of 7.2% in 2017, 5.1% in 2016, 25.5% in 2014 (obviously a statistical artefact), 8.3% in 2014, and 1.1% in 2013, according to the European Commission. The strong growth, despite the uncertain economic outlook, was mainly driven by companies nominally relocating in the country, such as Perrigo Co. and Jazz Pharmaceuticals Plc, who are attracted by the country’s very open economy and by its relatively low tax inversion rate of 12.5%.
Recently, Ireland’s central bank raised its economic forecast for 2019 to 4.9%, from its previous projection of 4.2%, as the economy operates at close to full capacity and continues to grow despites uncertain global environment.