House prices up by a miniscule 0.23% y-o-y in Q3 2019

Ireland’s house price growth is decelerating rapidly, amidst the uncertainty surrounding the Brexit. Residential property prices increased by a meager 0.23% during the year to Q3 2019, a sharp slowdown from a y-o-y rise of 7.51% a year earlier. In fact, it was the lowest growth since Q1 2013. During the latest quarter, Irish house prices increased 1.2%. 

Demand is now falling but supply is surging

In the first nine months of 2019, the total number of market-based household purchases of residential dwelling fell by 3.2% to 30,178 units from a year earlier, according to Ireland’s Central Statistics Office. Similarly, sales value dropped 2.1% y-o-y to €8.9 billion in the first nine months of 2019. In Dublin, the number of sales dropped 5.6% while sales value fell by 8.6% over the same period.

New dwelling completions surged by 18% to 14,764 units in the first three quarters of 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 8.3% in 2018, after GDP growth of 8.1% in 2017, 3.7% in 2016, 25.1% in 2014 (obviously a statistical artefact), 8.5% in 2014, and 1.4% in 2013, according to the International Monetary Fund (IMF). The strong growth, despite 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, the European Commission raised its economic forecast for 2019 to 5.6%, from its previous projection of 4%, as the economy operates at close to full capacity and continues to grow despites uncertain global environment. The organization noted that it will be the highest in the EU for 2019 and compared to a projected EU average growth rate of 1.4% this year.