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House Prices Roi August 09

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Found this interesting and wondered to what extent you think RoI price drops will impact on NI market...

Average House Prices Are Now Back at January 2004 Levels - Report

Tuesday, September 29, 2009 2:07 AM

(Source: Irish Times) By DOMINIC COYLE

AVERAGE HOUSE prices in Ireland are now back at the level seen in January 2004, according to the latest ESRI/Permanent TSB house price index .

Prices fell by 1.5 per cent in August, according to the data released yesterday, bringing the decline in the past year to 13 per cent. According to the survey, house prices have now been falling for two full years and are 24.4 per cent lower than at their peak in February 2007.

Niall O'Grady, general manager of business strategy at Permanent TSB, said the rate of decline had been more dramatic during the summer due to the low levels of activity in the market and a lack of confidence in any recovery this year.

"Recently, prices have started to fall faster in the Dublin region due to the high level of surplus stock available," he said.

House prices in Dublin have fallen by 18 per cent over the past year, compared with a 12 per cent decline for property outside the capital, the survey found. The average price for a house in Dublin is now [euro]306,795 compared to [euro]351,096 at the turn of the year.

Away from Dublin, the average price is now [euro]204,524. At the end of 2008, the average was [euro]223,984. The survey is likely to show further falls in coming months as the index is a three-month moving average and is based on agreed sale prices, but only calculated when mortgages are actually drawn down.

The time lag between a price being agreed and a deal closed means that the influence of the lacklustre summer market will be felt for some time yet.

The lack of activity in the market is illustrated by the dearth of detail in the Permanent TSB survey. Traditionally, the survey provided data on the prices being paid by first-time buyers compared to people trading up.

However, the lack of business in the market has led the Economic and Social Research Institute to determine that there is not a sufficient sample size to produce meaningful data.

The same is true for figures on the difference between new and existing properties and for the performance of homes in the commuter counties.

On the basis of the survey, however, it is likely that most people who acquired their home in the past five years are now experiencing some degree of negative equity.

Originally published by DOMINIC COYLE.

© 2009 Irish Times. Provided by ProQuest LLC. All rights Reserved.

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Nice find. Look at this bit ...

Traditionally, the survey provided data on the prices being paid by first-time buyers compared to people trading up.

However, the lack of business in the market has led the Economic and Social Research Institute to determine that there is not a sufficient sample size to produce meaningful data.

The same is true for figures on the difference between new and existing properties and for the performance of homes in the commuter counties.

On the basis of the survey, however, it is likely that most people who acquired their home in the past five years are now experiencing some degree of negative equity.

No first-time buyers = no buying chains = the housing market in Ireland is non-existent.

Edited by Belfast Boy

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Average House Prices Are Now Back at January 2004 Levels

Northern Ireland house prices are still at early 2006 levels.

My current estimate is that we will see 2002 price levels here.

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i was having a pint with an estate agent who,s connected to family while in cork last month , a house he sold in 2006 for 780k euros was sold again last month for 440k by him thats around 45% drop from peak, another thats up for sale at present for 1.6m euros for a year has a best offer of 650k at present.

anything from ERSI/PERMANENT TSB housing index should as with all VIs be taken with large doses of salt.

Edited by bearsrus

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Another anecdote. I know of someone who paid 198k euros for their house in late 2002. Their neighbour has just sold a similar house on their road (after a long time on the market). Their asking price dropped to 235k and when asked what they had actually sold for they said they wouldn't say as it would only depress them. They took it to mean that they'd sold for less than the new build price paid in 2002. (Mind you, travellers moved in next door which propbably knocked a few k off the value so maybe skewed the result.)

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Which were?

Back in 2007 I suggested on this forum that house prices in Northern Ireland could fall back to 2002 levels. Looking at the history of previous bubbles - unless we see high wage inflation in the next 3-5 years - that prediction will be accurate (in my opinion).

I think it is well worth waiting for just 1 more year to see if that looks likely to happen.

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<!--quoteo(post=2171250:date=Sep 30 2009, 08:42 AM:name=pajd)--><div class='quotetop'>QUOTE (pajd @ Sep 30 2009, 08:42 AM) <a href="index.php?act=findpost&pid=2171250"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->Which were?<!--QuoteEnd--></div><!--QuoteEEnd-->

Back in 2007 I suggested on this forum that house prices in Northern Ireland could fall back to 2002 levels. Looking at the history of previous bubbles - unless we see high wage inflation in the next 3-5 years - that prediction will be accurate (in my opinion).

I think it is well worth waiting for just 1 more year to see if that looks likely to happen.

upward pressure not!

http://www.independent.ie/business/personal-finance/property-mortgages/esri-predicts-35000-will-be-unable-to-pay-mortgage-1904957.html

rock on!

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