Sherry FitzGerald, Ireland’s largest estate agent, says that the average value of second-hand homes increased by 5.7% in 2022, down from average price growth of 9.6% recorded in 2021.

In Dublin, values grew 5.2% in the year, compared to 7.2% in 2021. Price growth continues to be stronger outside of Dublin, with average values nationally excluding Dublin rising 6.4% in 2022.

Managing director Marian Finnegan said she expects the slowdown in price growth to continue into 2023, with overall prices anticipated to increase by less than 3% in the year ahead.

“Macroprudential rules over the past number of years has kept price inflation at more moderate levels in the capital, where average values are higher,” Finnegan explained.

“For a variety of reasons including the easing of the rules for first-time buyers, we expect to see a convergence in the levels of price inflation in Dublin and nationally.”

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Sales activity volume was ahead of 2021 and above pre-Covid-19 levels too.

For the first three quarters of 2022, there were c.41,940 sales recorded on the property price register (PPR), excluding block sales and new homes acquired for social housing. This represented a 7.3% increase on the first nine months of 2021, and a 7.6% increase on the comparable period in 2019.

PPR data for Q4 2022 is not yet available.

New homes sales nationally increased 35.1% on the same period in 2021, and a 16.8% increase on 2019, as developments which were previously delayed due to pandemic restrictions were completed and sold in the year.

“That said, the latest data on supply reveals a more worrying trend with the number of planning permissions granted in Q3 2022 down 43% year-on-year,” Finnegan stated. “Commencements have also slowed, with the latest data from October showing that residential housing starts are down 31% on 2021.”

In the second-hand market, sales were 4.1% stronger in 2022 than in 2021 and activity up 8.1% compared to 2019. Owner occupiers represented 79% of all second-hand home purchases made through Sherry FitzGerald in the year, with first time buyers comprising over 40% of all owner occupiers.

As has been the trend for over a decade, the exodus of landlords from the rental market is continuing, with just 13% of purchases made by investors. Comparatively, 36% of all sales were investors selling their properties.

“The rental sector remains crippled by historically low supply, with enduring high levels of rental inflation,” said Finnegan.

For 2023, Finnegan expects transaction volumes to surpass their pre-pandemic levels. “Further growth to over 60,000 transactions is expected for 2023, with particularly robust activity in rural and coastal areas,” she predicted.

“While house completions are expected to exceed 26,000 for 2022, the anticipated V-shaped recovery in supply is now less likely. As such, a significant supply deficit will persist.”