Average asking price nationally is now DOWN 51.5% from peak.
exclusively based on asking prices
The price of new properties declined by 3.2% in Q4 bringing the annual rate of decline to 9%
Ms Kelleher said the outlook remains uncertain with further volatility in prices likely in 2013.
Average asking price nationally is now down 51.3% from peak.
For the first time, examines actual sold prices based on data from the Property Price Register
There was a 0.9% decline nationally in Q4, 2012 (so leave the Irish independent toilet papers in the shops)
Asking prices are still falling rapidly in Munster, Connacht and Ulster. Indeed, for the first time since prices started to fall, the fall from the peak is greater in Connacht-Ulster (55.9%)
Analysis of both articles
Price suppressing Factor for 2013:
Loss of mortgage interest rate relief, some of the demand from 2013 was stolen and crammed into 2012 instead
Lack of mortgage funding,
Further reduced disposable income and wages (due to continued recession and increased taxes not just in 2013 but beyond),
Increase in supply due to large increase repossessions. 185,000 mortgages are at risk of default (already restructured or in arrears) based on the latest analysis done by Constantine Gurdgiev (due to NAMA being forced to offload property and personal insolvency bill).
The introduction of a 1% stamp duty tax for first time buyers
New build costs are difficult to ascertain as although the cost of labour has decreased the price of materials has increased. (But site prices have decreased alot)
Some that isnt mentioned much in teh main stream media, but is touched on here by David McWilliams willl have a profoundly negative affect on property prices: the eventual and inevitable increase in the ECB interest rates.
The FED in the US has announced that it will not increase rates until after 2015 (and may actual be much later)
In Europe though we may not be so lucky.
Factors which may lead to an increase in property prices in 2013:
Increased rental yields may encourage buy to let (but will have a very negligible affect)
The abolishment of the high stamp duty rate for second home buyers (reduced to 1%)
A balance has been reached in Dublin and possibly in the other cities between supply and demand (Therefore this may give others outside Dublin a perception of future price movement) In Dublin the stock of available properties for sale continues to decline and is now at just over 4,000
The only other actual thing which I can see that the property market has going for it is that the main stream media propaganda Irish times and independent toilet papers are attempting to stoke the fires again (and the last thing buyers want is to miss the bottom, perception of future price movement)
My analysis of all this:
If the Government do want to revive the property market (and it is not my contention that they should be involved at all) Then obviously one way would be to leave the interest rate relief for first time buyers.
They could also do something that not many talk about and that is to ensure the banks borrow and lend on a long term interest rate, so borrowers could choose a fixed interest rate of X% over 30 years, this is done in other countries and is a sounder business model for banks and peace of mind/potentially more sustainable for buyers. If borrowers knew the total cost of the house for the life of the mortgage they may be more liable to purchase a house.
I believe it will take years for demand to meet the oversupply of houses outside of Dublin and although house prices may bottom out in the next year or two, it will take a while after for prices to rise much on a consistent basis.
Austerity budgets will continue for at least 3 more years. The government’s own figures show that unemployment will only fall negligibly over the next 3 years. (The fall is mainly due to net emigration)
There is no sign of any world recovery in the US have fiscal problems and a Gov debt of approaching 17trillion $, Germany's GDP is beginning to decline, Italy and France are also having problems with there debt to GDP levels. The UK also has huge debt problems (something which most media fail to comment on),
Being a small country exporting mainly to these places, we are far from out of the woods.