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Downturn Wipes 50pc Off Value Of Homes...

Economic downturn wipes 50pc off value of homes...



LARGE detached family homes in the capital have halved in value in the downturn.

Estate agents admit four- and five-bedroom detached properties in Dublin are now only fetching 50pc of their 2007 prices.

This means upwardly-mobile couples who shelled out an average of €1m at the height of the boom years are now sitting in a house worth just €500,000.

The Irish Auctioneers and Valuers Institute (IAVI), which represents auctioneers around the country, says that houses nationally are now worth 40pc less than at the peak.

Connacht has seen the smallest drop in house prices but even these are dramatic. The average two-bedroom townhouse in the region has fallen in value by 27.7pc.

Things are much worse in Dublin for struggling homeowners who are seeing themselves plunged further into negative equity as prices have plummeted by half. But this is all good news for buyers with cash today.

The IAVI annual property survey released shows that new two-bedroom townhouses in Dublin are down 36.3pc from their peak. Three-bed townhouses have fallen by 36.9pc and one- and two-bed apartments are down 42.8pc and 42.4pc respectively.

Also in the capital, three- and four-bedroom semis are down 35.3pc and 37.6pc and four- and five-bedroom detached houses are down 42.6pc.

Reductions in the Dublin second-hand homes market are more stark. One- and two-bed apartments are down 46.9pc and 47.8pc; two- and three-bed townhouses have fallen in value by 39.7pc and 41.3pc; and three- and four-bed semis have dropped by 41.4pc and 44.8pc.

The price drops in the rest of the country are also substantial. Three-bed semi-detached homes are down 37.4pc, 31.6pc and 32.8pc from peak prices in Leinster (excluding Dublin), Munster and Connacht respectively.

The IAVI figures, which are based on sale prices achieved, are a more accurate indicator of the market than other surveys, such as the recently released DAFT report which relies on advertised asking prices. The DAFT report put house prices nationally at 30pc lower than peak, pointing to a gap between asking prices and sale prices.

The IAVI survey also reports few sales in 2009 -- a year that was described as "perhaps one of the bleakest years the market has ever experienced in this country".

However, there are signs of recovery with agents reporting an increase in viewings towards the end of last year. Auctioneers in the Dublin area reported enquiries and viewings increased by a quarter and the number of sales closed was up 9pc.

IAVI president Aine Myler called on the Government to fast-track the planned national register of property prices to provide for transparency in the market and to restore consumer confidence, citing a possible bottoming out of the market.

"These annual results are in line with our expectations for 2009 and consistent with our belief that the average residential property values would decline 40pc to 50pc from peak to trough," she said.

"The survey results indicate that the market floor is close, if we have not reached it already."



Report by Yvonne Hogan - Irish Independent

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