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House Prices Plummet...

Gap in asking/selling prices of 'up to 20%'...

THE gap between asking prices and selling prices can be as high as 20 per cent says economist Paul Murgatroyd.

There is no way for the public to accurately determine selling prices in the absence of a national price database linked to the Land Registry, but Murgatroyd, who analysed MyHome.ie’s price survey published this week, says his view is that the figure is “anywhere between zero and 20 per cent below asking price, depending on the seller, the buyer and the property”.

Myhome.ie’s figures indicated that asking prices have fallen in Dublin by 33 per cent since the peak of the property boom at the end of 2006. This followed a price index by Sherry FitzGerald saying that selling prices have plummeted by nearly 50 per cent in Dublin since the peak.

Vendors and buyers are being left to figure out current property values for themselves by piecing together information from the few indices available: these include ESRI figures based on the number of loans being drawn down; property websites’ data, which is about asking prices; and estate agencies’ indices, based on a fixed sample of properties that are revalued every quarter.

This has led to a big divergence in asking prices in some areas.

Despite the confusion, there appears to be some activity in the market particularly in the lower end with first-time buyers going for well-presented, extended properties in the €150,000-€350,000 price bracket, says Darren Chambers of Lisney who says properties which “tick all the boxes and represent obvious value are sometimes taking only three weeks to sell”. People who sold their homes at the peak are also buying but are taking their time and refuse to compromise on their wish list.

Paul Murgatroyd says there is some detective work involved for both vendors and buyers and says vendors should canvas the opinions of “two or three estate agents” with valuation qualifications before setting an asking price.

“They also need to look at the level of supply in their area. It’s a suck-it-and-see situation: the vendor can shift price up or down but it’s more difficult for a buyer to know where to pitch a bid.”

Getting a sale could mean undercutting the competition by 10 to 20 per cent. He says buyers can ask around local agents if a property they are interested in is priced correctly and vendors should beware when an agent suggests a bullish asking price “because it could be that they just want to get a board up on your road”.

Darren Chambers says it doesn’t take long to ascertain whether a property is going to sell: “usually it’s fairly obvious within four to five weeks”.

Paul Murgatroyd says the Government “has been posturing and doing whatever they can to evade establishing a national price database. It’s down to a psyche of privacy and confidentiality in Ireland surrounding property and the fact that it’s written into data protection legislation – but if other European countries can do it, why can’t we?”


Report by EDEL MORGAN - Irish Times.

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