Surge in home purchases despite lockdown restrictions

RESTRICTIONS on viewing properties have failed to dampen activity in the housing market.

The third lockdown means buyers have had to resort to virtual viewings when seeking a home.

There were more than 13,100 homes bought in the first three months of this year compared with the same quarter last year.

This is an extra 1,400 home purchases, and is despite buyers not being able to physically view properties they are considering buying.

This represented a 12pc increase in the number of purchases in the first three months of the year compared with the same quarter last year, according to research carried out by Davy from the Property Price Register.

The total number of transactions recorded for the first three months of the year amounts to €4.2bn, Davy economist Conall MacCoille worked out.

“Estate agents have clearly adapted to the third lockdown, maintaining activity levels despite restrictions on viewings and travel, via virtual viewings and other initiatives,” he said.

The surge in purchases means that Mr MacCoille has maintained a mortgage lending forecast of €9.5bn for this this year.

Davy has predicted that transaction volumes will rise by 13pc this year compared with last year.

This will see the number of purchases going from 49,000 to 55,000.

Rising transaction levels also come despite a chronic lack of new and second-hand homes to buy.

Homes construction activity has only recommenced in recent weeks.

Property website Daft.ie said recently the total number of properties available to buy on March 1 was just under 12,000, the lowest figure recorded since the rise of advertising properties for sale online.

This represents a year-on-year fall of 40pc nationwide, although the stock available for sale in Dublin has fallen by less than the national average.

Mr MacCoille calculated that transaction volumes were down 10pc in January compared with the same month last year.

But they shot up by 21pc in February and by 22pc in March.

“So there appears to have been little disruption from Covid-19 restrictions,” he said.

He said the delayed summer trading season in 2020 may be one reason activity has held up so far this year.

Sales agreed in the final months of last year may have been finalised in early 2021.

“However, the very latest transaction data for April still show no fall off. It appears Irish estate agents have adapted their businesses to the lockdown restrictions.

“Virtual viewings and other initiatives are clearly being used to circumvent restrictions, so activity levels are maintained close to normal levels,” the economist said in a note to investors.

Last week the Central Statistics Office found that property price inflation continues to gather pace.

Prices were up by 3pc in February compared with the same month a year ago, according to the Central Statistics Office.

It was the fastest rise in prices in nearly two years.

Experts are predicting that prices will continue to rise on the back of constrained supply.

In Dublin, prices were up by 1.2pc in the year, but outside the capital there was an increase of 4.7pc, the CSO said.

Chairperson of Association of Irish Mortgage Advisers Trevor Grant said prices would keep going up in the medium term.

“Stock for sale is now at an all-time low across the country and this must apply pressure on prices to increase in the coming months.”

Buyers paid a median, or typical, price of €262,000 for a home in the year to February, the CSO said.

This is up €1,000 from the median price paid in January.