Rate of house price inflation halves as buyers become more cautious, poll finds

The Real Estate Alliance said the actual selling price of a three-bedroom semi-detached house across the country rose by 1.4 per cent over the past three months
Rate of house price inflation halves as buyers become more cautious, poll finds

Michelle Devane, PA

The rate of house price inflation has halved in the past three months as home-buyers become more cautious amid rising living costs, a new survey has found.

The actual selling price of a three-bedroom semi-detached house across the country rose by 1.4 per cent over the past three months to €290,630 – an annual increase of 10 per cent, according to the latest Real Estate Alliance (REA) average house price index.

REA said this is a marked slowdown on the 2.9 per cent quarterly increase recorded in the preceding three months, “signalling a cooling of the frenetic demand in the marketplace”.

The third quarter index also found that A-rated homes are fetching 12 per cent more than C-rated properties.

The gap rises to 16 per cent in the capital as running costs become more important to home-buyers.

Barry McDonald, of the Real Estate Alliance, said there has been a ‘definite slowdown’ in demand (REA/PA)

The time taken to reach “sale agreed” rose from four weeks to five weeks as REA agents nationwide reported a “less frenzied” approach to viewing and buying.

While the actual average selling price of three-bedroom homes in Dublin city is about to breach the €500,000 mark, the 0.8 per cent quarterly rise to €497,500 is half that experienced in the previous three months.

REA spokesman Barry McDonald said: “We have seen a definite slowdown in demand levels and the urgency that we were seeing with buyers has reduced.

“The traditional summer lull returned for the first time in a few years and there were no signs of the market heating up again in September, which is good news for buyers.”

He went on: “Interest rate rises and cost-of-living inflation are definitely affecting sentiment, with viewers patiently waiting for the right property.

“There is still a massive shortage of housing, but Dublin agents REA Grimes are reporting an increase in supply and a wider choice of properties coming to market, leading to a longer sale time.

“The energy rating of a house is becoming a main talking point, with buyers increasingly taking the cost of heating or increasing the energy rating of older homes into account.”

First-time buyers accounted for almost 60 per cent of all purchasers in the third quarter of this year, according to REA, a figure which rose to 76 per cent in Dublin.

More in this section

Sponsored Content

Add Echolive.ie to your home screen - easy access to Cork news, views, sport and more