Property values on the up: 3 good reasons why NOW is a good time to buy.
1. Price trends
The Cork property market has stabilized. Today’s CSO data figures show a 1.2% rise for the first time in 4 months outside Dublin. Daft in their most recent report for 2013 said there was a 0.1% rise in Cork prices in the first quarter of 2013. It’s a pity Daft don’t break the Cork market down into parts like they do for the Dublin market. The Dublin market is so varied that parts show growth of over 6% while other parts show declines of 5%? No doubt the same would be reflected in Cork. At least parts of Cork would show bigger gains than the 0.1% figure recorded by Daft. At any rate if the popular areas in Dublin are showing signs of a comeback it will not be long for the same signs to show in Cork.
- Supply
Agents are all reporting a lack of stock in the right areas. Bidding is definitely on the way back. Only 1.9% of the total private stock of residential property in Cork is for sale. What does this mean anyway? In effect it all boils down to Supply and Demand. If there is a short supply of houses this will result in there being a big demand which in turn leads to a price increase. Viewings are also on the increase. But the average time to sell in Cork remains at 10 months.
- The Banks
There was just €331 million lent out to irish mortgage holders in the first three months of 2013. This is a 26.4% decline on the same period last year. Davy in their recent review of the banking sector says that “mortgage lending should rebound as the year progresses”. They say that in aggregate, Irish banks’ targets suggest that mortgage lending should equal around €4bn in 2013 but they admit this looks “ambitious”. If the Banks forecasts are correct then Q2 –Q4 should see a flurry of bank lending to reach the €4 billion mark. This can only result in it being easier for the consumer to get funding from the pillar banks.
- Who is buying?
Although not a reason to buy, it is interesting to see who is buying. Cash has been king for the past 6 years and remains so. But who are these cash buyers? Notably a lot happen to be ex-pats who spent the past number of years either in the UK or further afield building up a cash pile. They may equally be Irish people who never bought in the boom and remained renting. It’s estimated that over 40% of those buying in the residential market are cash buyers. The profile of the buyer (cash or non-cash) is interesting too – the first time buyer makes up 25% with the investors back in the market with 10%. The investor now sees that there is value out there. Owner occupiers make up the balance.
Tags: property
