Date 29 May 2014

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Copyright NLA Media Access. For internal use only. Not for reproduction.
Bubble warning as
home prices rise 17pc
By Christian McCashin
OFFICIAL figures released
yesterday showed that resi-
dential property prices in
Dublin have risen by a dra-
matic 17.7 per cent in the
year to April.
The Central Statistics Office
said that property prices for
the rest of Ireland (excluding
Dublin) were up by just 1.3 per
cent over the same period.
The figures were greeted with
fresh warnings about an emerging
bubble in the capital.
The CSO figures are based only
on homes bought with mortgages
excluding the large number of
cash buyers who are adding to the
price pressure.
The Soci ety of Chartered
Surveyors Ireland said yesterday
that Dublin and elsewhere faced
an acute shortage of residential
properties and growing demand.
The society said: Urgent action
must be taken to relieve the sup-
ply pressure on the market and to
avoid a situation whereby house
prices are pushed out of reach for
prospective purchasers.
Director Conor ODonovan said:
We have gone from building 89,000
units in 2006 to building 8,300 in
2013, and clearly the current price
inflation is being caused by the
lack of building in recent years.
The SCSI does not want to see
a return to the unchecked price
inflation we saw over a decade ago
and neither do we want to see a
continuation of the current house
price volatility.
Construction industry experts
said housebuilders were being
blocked from building badly
needed homes as they were ham-
pered by a lack of lending from
the banks, which are reluctant to
lend money as they struggle with
losses from the crash.
The Construction Industry Fed-
eration has warned: Access to
finance is a major problem. The
banks have been demanding
unrealistic equity of 50 to 60 per
cent for any projects. After six
years of decline in the industry,
any construction companies that
are still going do not have access
to that kind of capital.
The construction groups call for
State action to get developers
building was backed by the Irish
Banking Federation yesterday.
In an IBF report, Davy econo-
mist Conall Mac Coille said:
Policy should be focused on alle-
viating supply constraints on the
construction sector, while resist-
ing efforts to loosen credit stand-
ards on mortgage lending to first-
time buyers.
Already the Government has
proposed action to triple housing
output by 2020.
The measures include a 3 per
cent levy on undeveloped housing
land and a scheme to help first-
time buyers.
But Mr Mac Coille said: Ireland
needs a help-to-build scheme, not
help-to-buy.
The CSO figures showed that
average property prices nationally
rose by 8.5 per cent in the year to
April compared to an increase of
7.8 per cent in the 12 months to
March.
On a month-by-month basis,
prices nationally rose 1.4 per cent
but when Dublins 3.1 per cent
increase was stripped out then
prices outside the capital actually
fell by 0.3 per cent from March to
April.
Angela Keegan of property web-
site Myhome.ie said: Were seeing
a huge supply and demand bubble
in Dublin at the minute, as theres
huge demand.
Double-digit growth year-on-
year is not sustainable over the
longer term. I think at the moment
in Dublin theres a bubble, theres
just enough supply and its being
outstripped by demand.
A rate of 17.7 per cent in a year
is huge, its just not sustainable in
the longer term, and 3.1 per cent
in a month is high but with any
price index the trend is what one
needs to look at. And indeed we
are seeing an upward trend in
Dublin without a doubt.
Estate agents Savills last year
reported how cash buyers
accounted for 57 per cent of all
home purchases in the first six
months of 2013 up from just 3
per cent in 2010. This growth has
been spurred on by the difficulty
in borrowing from the banks.
Comment Page 12
christian.mccashin@dailymail.ie
More houses must
be built urgently
These rises are
not sustainable






Date 29 May 2014
Page 15






























































Copyright NLA Media Access. For internal use only. Not for reproduction.
SALES OF FURNITURE AND DIY GOODS RISING
HOUSEHOLDERS are driving an
increase in retail sales on the
back of rising DIY and furniture
sales, a survey said yesterday.
Furniture and lighting sales
have been rising for the past
eight months and turnover
increased by more than 18.4 per
cent in the year to March,
according estate agents Savills.
Economist John McCartney
said: CSO estimates indicate
that capital expenditure on
home improvements has been
trending sharply upwards since
the middle of last year.
This is encouraging custom-
ers back into retail parks and
has contributed to a dramatic
recovery in furniture store
sales.
Furniture store sales slumped
47 per cent between May 2007
and October 2012.
But over the past 12 months
furniture and lighting stores
have been the best performers
in the retail market, with over-
all sales up by nearly 20 per
cent.
DIY stores which suffered
badly during the crash have
also seen a strong recovery
with sales up 5.3 per cent in the
year.
Mr McCartney said consumers
now had the confidence to
consider the purchase of big-
ticket items.
PRICES RISING 5K A MONTH
THE average price of a Dublin
house is now 330,000,
according to a survey by
estate agents DNG last month.
It found that price was rising
by about 5,000 a month.
Nationally, the average is now
177,000, according to DNG.
But we are a long way from
the height of the boom: prices
are only slightly more than
half what they were in 2007.






Date 29 May 2014
Page 15






























































Copyright NLA Media Access. For internal use only. Not for reproduction.
Irish Daily Mail, Thursday, May 29, 2014