Property prices to ‘keep rising next year’ as more people moving house

Their forecast comes as the pace of price increases nationally picked up in October, with supply shortages biting and more movers becoming active in the market.

House prices nationally increased by 2.3pc in the year to October 2023, the Central Statistics Office said.

This is up from a rise of 1.4pc in the year to September.

In Dublin, however, prices decreased by 0.6pc. Property prices outside Dublin were up by 4.5pc.

It is the sixth month in a row that prices in the Dublin area have fallen.

Higher interest rates have been hitting prices in the capital, particularly for more expensive homes. The European Central Bank has hiked interest rates 10 times in the last year and a half.

Strong demand from first-time buyers has ensured prices across the State keep rising.

“It could be that we are seeing more momentum in terms of prices into the next year,” said economist Austin Hughes, adding that there could be steady rises next year.

The CSO figures show that mover-purchasers have returned to the market, after being spooked by ECB rate rises over the past few months.

There was a 10pc increase in the numbers of movers in the past year. This compares with a rise of 2.8pc in the number of first-time buyers.

Mr Hughes said the data shows existing home prices have stopped falling. Movers may be more confident that interest rates have peaked and are likely to fall in the new year. He said movers tend to have greater spending power when it comes to housing than new buyers.

Prices of new dwellings in the third quarter of this year were 10.4pc higher than in the same quarter last year, the CSO said. Prices of existing dwellings in Q3 2023 were 1pc lower than in the corresponding quarter of 2022.

In October, 4,604 dwelling purchases by households at market prices were filed with the Revenue Commissioners.This is up by 7.2pc when compared with the 4,296 purchases in October last year.

The median price of a dwelling purchased in the 12 months to October was €323,000.

Broken down by Eircode, the most expensive area over the year to October was A94 in Blackrock, south courty Dublin, where there was a median price of €730,00.

Castlerea in Roscommon, with the F45 Eircode, had the least expensive median price of €135,000.

In local authority areas, the lowest median price for a house in the year to October was €160,000 in Longford.

The highest median price in a local authority area was €630,000 in Dún Laoghaire-Rathdown.

CSO statistician Niall Corkery said: “Residential property prices rose by 2.3pc in the 12 months to October 2023, up from 1.4pc in the year to September 2023.

“In Dublin, residential property prices saw a decrease of 0.6pc, while prices outside Dublin were 4.5pc higher in October 2023 than a year earlier.”

The national property price index is now 5.1pc above its highest level at the peak of the property boom in April 2007.

Dublin residential prices are 6.3pc lower than their February 2007 peak.