Commenting on the most recent CSO Residential Property Price Index for August IPAV, the Institute of Professional Auctioneers and Valuers, said the double-digit growth evident in the figures across 15 of the 20 market cohorts captured is likely to abate somewhat towards the end of the year.
Pat Davitt, IPAV Chief Executive said, increasing supply, although far from sufficient, is now tapering the high level of growth seen in today’s figures and levelling off.
“However, special properties and those in coastal regions are likely to continue to command strong prices. This is evident with a 15.3 percent increase in the South East in today’s figures,” Mr Davitt stated.
And he said Bord Pleanála’s decision to insist that two developments, in Dublin and Galway, were to be reserved for individual buyers over institutional investors is to be welcomed.
“Institutional investors have a place in the market but this decision brings a greater balance to the equation enabling individual buyers compete in a market with a deep shortage of supply,” he said.
However, he said there were still “major impediments” in the way of building more affordable homes.
“It is disappointing we did not see any move in this week’s Budget to reduce the 13.5 percent VAT rate on new housing for owner-occupiers or extend the Help-to-Buy scheme to include second-hand homes. This was a missed opportunity,” he added.
He said issues with planning, taxation, the supply of services are delaying the delivery of housing and increasing the cost of delivery. There needs to be a fundamental re-appraisal of these issues to address the supply side problems in the market.
IPAV welcomes extension of Help-to-buy Scheme
Meanwhile, the IPAV HAS welcomed the extension of the Help-to-buy scheme into next year but said it was a pity it was not being extended to second-hand homes, “which would have encouraged more movement in the market, particularly where those who bought at the top of the market may now have a different housing need.”
Pat Davitt, IPAV Chief Executive also welcomed the Zoned Land Tax to be introduced to encourage the use of land for building homes. However, he said, unfortunately, it is going to take some time to see the impact given that it will have a two-year lead-in time for land zoned before January 2022 and a three-year lead in time for land zoned after January 2022
He said the extension of relief for pre-letting expenses for landlords for another three years was very positive, as was the €85 million for retrofitting and the €65 million for housing adaptation grants.
“However, it is disappointing that today’s Budget does not have any measures to equalise the tax treatment of private landlords with that of commercial landlords, with private landlords leaving the market at a rate of two out for every one in.
“It is because of the onerous and unfair tax treatment of such landlords by comparison with commercial landlords that they are leaving, despite record high rents.
“Equalisation of tax treatment would encourage long-term more secure rentals for tenants,” he concluded.
