Pace of property price rises picks up despite supply rising to 15-year high

The Central Statistics Offices (CSO) issued figures showing prices rose by 5.4pc in the 12 months to January.

This is a faster rise in prices than the previous month which had seen values rise by 4.1pc in the year to December.

Despite recovering to a 15-year high last year, the supply of new housing is still not growing fast enough to meet demand, which is acting to push up prices, the CSO said.

In the year to January prices in Dublin were up by 4.5pc, and prices outside Dublin rose by 6.1pc.

Even fewer properties for sale outside of the capital and the continuing popularity of working from home means prices outside of Dublin are rising faster than in the city and its surroundings.

CSO statistician Niall Corkery said: “Residential property prices rose by 5.4pc in the 12 months to January 2024, up from 4.1pc in the year to December 2023.

“In Dublin, residential property prices saw an increase of 4.5pc, while property prices outside Dublin were 6.1pc higher in January 2024 than a year earlier.”

The region outside of Dublin that saw the largest rise in house prices was the Mid-West, which includes Clare, Limerick, and Tipperary. Prices were up by 9.5pc.

There was a rise of just 2.4pc in the Border area of Cavan, Donegal, Leitrim, Monaghan, and Sligo.

In January some 3,621 dwelling purchases by households at market prices were filed with the Revenue Commissioners.

This is a decrease of 1.5pc when compared with the 3,675 purchases in January 2023.

Households paid a median or mid-point price of €330,000 for a residential property in January.

The lowest median price paid for a property was €165,000 in Leitrim, while the highest was €620,000 in Dún Laoghaire-Rathdown.

The most expensive Eircode area over the 12 months to January 2024 was A94 Blackrock with a median price of €720,000.

Castlerea had the least expensive price of €134,000.”

Ian Lawlor, managing director of Lotus Investment Group, which lends to developers, said the continued pick-up in house price growth is further evidence that the Irish housing market has regained momentum.

He said the mismatch between housing supply and demand remains painfully evident.

“Recent statistics marking a 15-year peak in the construction of new homes, with 32,695 units completed in 2023, ostensibly paint a picture of construction progress and achievement.

“Such statistical milestones, while noteworthy, should not serve as a smokescreen for the underlying challenges that persist in the housing sector.”

But the rise in the level of house building comes in the context of a decline in housing construction post-2008, and the subsequent stagnation in the housing sector.

This decline becomes even more critical against the backdrop of a population that grew by 8.1pc to 5,149,139 from 2016 to 2022, Mr Lawlor said.