PROPERTY prices have risen again, piling more pressure on people trying to purchase their first home.

March saw prices rise at their fastest pace in two years.

Potential first-time buyers are already being hit by soaring rents and stagnant wages.

The latest figures from the Central Statistics Office show that property prices rose again in March.

A chronic shortage of homes to buy and pent-up demand from those with pandemic savings is pushing up prices.

Prices of houses and apartments rose by 3.7pc nationally in the year to March, as the market accelerated further.

This compares to an increase of 3pc in the year to February and an increase of 0.9pc in the 12 months to March last year.

In Dublin, residential property prices saw an increase of 2.5pc in the year to March, while property prices outside Dublin were 4.9pc higher.

The region outside of Dublin that saw the largest rise in house prices was the Midlands at 6.7pc.

At the other end of the scale, the Mid West saw a 1.2pc rise, the CSO said.

Prices of new homes rose by 2.5pc in the first three months of the year when compared with the same quarter last year.

For second-hand homes the rise was 3.3pc in the first three months of this year, as a chronic shortage of homes were put up for sale.

Restrictions on viewings during the lockdown are likely to have contributed to fewer people selling second-hand homes.

Property prices nationally have increased by 90pc from their trough in early 2013.

Dublin residential property prices have risen 97.8pc from their February 2012 low.

In the Rest of Ireland they are 90.2pc higher than at the trough, which was in May 2013.

Households paid a median, or typical, price of €262,500 for a home in March.

The Dublin region had the highest median price at €390,000, the CSO said.

The highest median prices outside of Dublin were in Wicklow at €358,000 and Kildare at €325,000, while the lowest price was €113,750 in Longford.

Meanwhile, new figures show that Ireland is the joint most expensive country for new mortgage rates in the eurozone.

It shares the dubious distinction with Greece, according to Central Bank of Ireland data.

The weighted average interest rate on new Irish mortgage agreements was 2.79pc in March.

Expensive mortgages and Central Bank limits on the amount of money people can borrow relative to their incomes are combining to put pressure on first-time buyers.

New mortgage rates here were down 1 basis point on March last year.

The average for the euro area stood at 1.26pc in March, although the rate varied considerably across countries.

“Ireland had the joint highest mortgage interest rates across the euro area,” the Central Bank said.

The move by Ulster Bank and KBC to leave this market means it is unlikely rates will fall much over the short term at least, said Daragh Cassidy of price comparison site Bonkers.ie.

He said he average first-time buyer mortgage is now around €250,000.

This means someone borrowing this amount over 30 years is paying almost €192 extra a month compared to our European neighbours or almost €70,000 over the entire term of the mortgage.

Banks blame regulatory rules on the higher amounts of capital they have to put aside when they issue a mortgage here, compared with the rest of the eurozone, and the difficulties in repossessing homes where mortgages are in default for the high rates.