Houseprices settorise by up to 10 percent
HOUSE prices in Wexford are set to rise by up to 10 per cent over the year, according to the Society of Chartered Surveyors Ireland’s Annual Residential Property Review and Outlook Report for 2017.
Wexford-based chair of the society’s south east region Karol Jackson, from Menapia Properties, said she had had her busiest January in years.
‘I’ve had quite a few instructions, both for sale and to let,’ she said.
‘I concentrate mainly on the residential side and people, who may have been sitting on their properties for some years because the value is so low, are deciding to sell.
‘It’s the same with the rental sector because rents have gone from a very low base to where they may have been in the 1990s.’
Karol said she believed that house prices around the county were likely to rise by at least 10 per cent this. ‘It’s all supply driven. ‘ There is no supply and the main demand is in town houses. There is also very good demand for fixer-uppers, but they are very hard to get,’ she said.
Karol said that there was still resistance to anything over €300,000, particularly in the country, however, areas and villages close to Wexford such as Barntown, Crossabeg and Drinagh, which were within 10 minutes’ drive of the county town, were very popular.
‘I’m optimistic about the future.. we’re over the worst of the property crash and while the banks are still being very strict with their mortgages they are very anxious to lend.’
National property prices are set to rise by an average of seven per cent, with the price of the most popular house type, the three-bed semi-detached, predicted to rise by an average of 9.4 per cent nationally.
According to the society’s review, the largest increase in the country is predicted in Leinster, excluding Dublin, where all housing unit types are predicted to rise by with an increase of 11 per cent projected for one and twobed apartments and a rise of 10.6 per cent forecast for three-bed semis.
The survey predicts that residential rents will rise on average by between eight per cent to 10 per cent outside of the rent control areas of the four local authority areas of the Dublin Region and Cork City Council area.
Annual rent increases are capped at four per cent in these designated pressure zones. The government is reported to be planning to extend these zones to 20 more towns, although none in Wexford, at the moment.
Ronan O’Hara, Chair of the SCSI’s Residential Agency Group said the lack of supply, public policy and projected economic growth may continue to inflate house prices, but he warned that the latter could not be taken for granted given the uncertainty caused by Brexit.
‘Four our out of five surveyors outside Dublin believe Brexit will have a negative impact on our economic growth. While this figure drops to 50 per cent in Dublin, it shows the uncertainty which exists for the coming year.’
‘ The drop in sterling has reduced the buying power of people looking to move here and that is probably one of the reasons why 36 per cent of surveyors across the country believe that Brexit has already had a negative impact on residential activity levels.
‘Interestingly, a clear majority of surveyors (62 per cent) anticipate that additional countries will vote in favour to leave the EU over the next three years.’
Mr O’Hara said that on the other hand, the changes which the Central Bank made to its lending rules and the introduction of the ‘Help to buy’ scheme are likely to contribute to an increase in activity in the short to medium term.
Eighty per-cent of respondents to the survey believe ‘Help to buy’ will lead to price increases in the coming year.
While this is good news for vendors, struggling first time buyers will be disheartened.
While rising prices will probably encourage more builders to start building houses it really is up to Government to tackle some of the underlying issues - including high construction costs - and to make housing more affordable.”
The report anticipates continued and strong rental price growth over the coming 12 months across all regions, fuelled by a sustained demand combined with a continuing housing shortage particularly in and around the regional cities.
Overall the greatest increases are forecast for both 2 and 3 bed apartments and townhouses at over 10 per cent.
Mr O’Hara said that while the proposals to extend the designated pressure zones to 20 more towns might be well intentioned, they were also short sighted.
‘In our survey the introduction of permanent rent control measures was ranked as the highest negative measure that will impact upon the supply in the rental market. If this goes ahead it will discourage landlord investment in the rental market.
‘Similarly anyone involved in buy to let properties will exit the market and it’s likely a lot of owner occupiers will purchase them.
‘ That might be good news for them but not for those renting as rents will continue to rise.
‘ The government may be putting out one fire, but they are simply starting another,’ he said.
The SCSI’s Annual Residential Property Review and Outlook Report 2017 is available at www.scsi.ie
WE’RE OVER THE WORST OF THE PROPERTY CRASH. BANKS ARE STILL STRICT WITH MORTGAGES BUT THEY ARE ANXIOUS TO LEND