Commenting on the CSO Residential Property Price Index for October, Brokers Ireland said the 2.3% year-on-year increase marks a bigger increase than has been seen for several months.
Rachel McGovern, Director of Financial Services at Brokers Ireland, which represents 1,225 Broker firms said this clearly reflects the very strong demand in the market.
“The October figure is also showing the number of purchases up by 7.2% year-on-year. However, this week BNP Paribas Real Estate found Ireland’s construction activity index dropped to 44.5 in November, down from 47.3 in October, the fifth successive month of decline. That is worrying," Ms McGovern stated.
She said clearly the ten ECB interest rate rises since July 2022 are beginning to show their impact.
“This is hurting aspiring buyers, investors and existing mortgage holders and since the impact of such increases take time to emerge it looks like we’ll see more devastation arising from them," she added.
She said while people are aspiring to home ownership, and paying a mortgage is generally cheaper than renting, and also makes sound economic sense over the longer term, those on lower incomes and without family support are most severely impacted.
“This market suits the better off, unfortunately. We need to build more homes and at more affordable prices,” she said, pointing to high State take on home building, from VAT to a host of local levies, including for planning and utilities.”
She said all of these costs are passed on to buyers who will continue to repay them over the lifetime of a mortgage, and now with much increased interest rates.
