House prices rose 14.4% in the 12 months to December, the fastest rate of growth recorded since before the financial crash, as the property market surged in 2021 after contracting for several consecutive months at the outset of the pandemic.
December marked the 13th successive month in which property prices rose, according to the Central Statistics Office's (CSO) Residential Property Price Index, with growth accelerating compared to November (14%), October (13.3%) and September (12.4%).
In Dublin, residential property prices rose 13.1% year-on-year while outside the capital, prices were 15.4% higher compared to December 2020, but the chair of the Association of Irish Mortgage Advisors (AIMA) expects growth to slow in 2022.
"The impact of inflation is being felt across a broad spectrum of goods and services, and property prices are no different. However, while the growth in property prices remains strong, we would expect this to slow as the year progresses," Trevor Grant said.
"This is due to the anticipated increased supply coming on stream, and the Central Bank’s Macro prudential rules kicking in, as exceptions potentially diminish or become harder to obtain, and borrowing power is reduced accordingly."
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The median price paid for a residential dwelling in Ireland last year was €280,000, up €20,000 from an average of €260,000 in 2020, with the highest average paid in Dublin (€380,000) and Dun Laoghaire-Rathdown (€532,000) in particular.
Outside of Dublin, the highest median prices were paid in neighbouring Wicklow (€349,000) and Kildare (€320,000), while Leitrim (€110,000) was the cheapest county for property on record.
The mean average price, meanwhile, rose from €287,043 to €326,457 year-on-year nationally, with Dublin (€506,667) and Dun Laoghaire (€701,956) again the most expensive areas, the mid-east commuter belt (€339,157) not far behind, and prices lowest in the border region (€167,485).
Overall, the national index is now 4% lower than its 2007 peak, and prices in Dublin and the rest of Ireland were 11.3% and 5.7% off their respective peaks the same year. Property prices nationally have risen 114% since early 2013, with prices in Dublin rising 119.6% since February 2012, and homes in the rest of the country now 117.1% more expensive than in May 2013.
Prices for new homes in the fourth quarter were 5.1% higher year-on-year, and prices for existing dwellings were up 16.7% as house hunters competed for second-hand homes as supply for new homes struggles to meet demand.
A total of 5,170 residential property transactions with a combined value of €1.8bn were registered with the Revenue in December, with existing homes accounting for more than three-quarters of acquisitions (77.6%) and new dwellings making up the balance (22.4%).
(Pic: Getty Images)
