It’s a deal or no deal scenario for Irish property in 2019 as the spectre of Brexit hangs over property agents’ predictions for the coming year.
A survey carried out for the Irish Independent by the Real Estate Alliance Group has found that agents throughout the country expect prices to rise by 4.2% on average in the next 12 months.
However, a hard Brexit will present the market with challenges across the country, the survey has found.
The 4.2% prediction comes off the back of a 2018 which saw prices increase by 4.64% nationally and 1.97% in Dublin city and county with less than 1% growth across the country in Quarter Four.
Price rises of 2.8% are predicted by agents in Dublin city, with north county Dublin increases of 4% forecasted (4.9% last year), just ahead of an anticipated upturn of 3.5% in the south of the county (0.9% in 2018).
John Cumisky of REA Cumisky in Swords and Balbriggan is predicting a slow start to the year until Brexit is resolved, with any increases in the low single digits.
This is echoed in the higher end of the market in South Dublin where REA Ed Dempsey states that the Brexit effect is now starting to show at the upper end of the market, and that next year’s prices will reflect the Brexit outcome.
“Typically, it remains the case that lower value stock is selling better than larger family homes above €400,000,” said REA spokesperson Barry McDonald.
“We expect minimal increase in values as stock levels on the market continue to rise.
“In my own area of Lucan, new home developments are earmarked to hit the market in Spring 2019, and this will only continue the trend of increased stock numbers.
“It is hard to predict what will happen with Brexit and property prices. Our agents either see people holding back in border and holiday home areas because sterling might rise giving buyers more power, or more generally, because they do not know how the market will react to a no deal scenario.”
Agents in three of the four main cities outside Dublin are cautiously optimistic about 2019, with rises of 4% predicted in Cork (2.4% in 2018) and 5% in Galway which experienced 9.7% growth last year.
While Limerick is also forecasting 4% which matches its yearly growth, with agent Michael O’Connor of REA O’Connor Murphy predicting an increase in the new homes market while the second-hand area will behave as in the latter stages of 2018 with sales taking longer to transact.
Agents in Waterford are predicting that prices will rise by 10% after a year which saw average houses sell for €210,000 – an increase of €15,000 or 7.7% in the last 12 months.
“Demand continues to be strong and asking prices are being exceeded by competitive bidding in Waterford City,” said Des O’Shea of REA O’Shea O’Toole.
“We expect the 2019 market to be buoyant. Factors include easier access to mortgage finance, good demand, and scarcity of given property types.”
Counties around Dublin are forecasting a rise of 4.6% on average after a year which saw their prices increase by 4.1%, slightly below the national figure.
“We would anticipate a modest increase, possibly up to 3% during 2019,” said Darina Collins of REA O’Brien Collins.
“The political uncertainty around Brexit, the Central Bank lending restrictions and the fact that mortgage exemptions are front loaded to the beginning of the year are all pointing to a fairly flat market.”
Apart from Waterford city, the biggest rise being predicted nationwide is in Longford, where affordable housing at an average price of €105,000 drove inflation of 16.7% in 2018.
The Brexit effect is not only being felt in our major towns and cities, with middle Ireland anticipating the downside of no agreement on property prices.
“A hard Brexit could have a serious knock-on effect to some large employers in the area and to the residential letting market,” said Robbie Grace of REA Grace in Callan Co Kilkenny, where a 2% is predicted for 2019.
Former REA Chairman Eoin Dillon has described how a deal or no deal scenario would affect business in Tipperary in plain terms.
“If Brexit goes well then a +5% to +10% increase will be on the cards. If it’s no deal, or a bad deal, then we foresee only a nominal increase,” he said.
The higher end of the market, over €500,000, has been impacted by Brexit, claim agents REA Coyne & Culloty in Killarney.
“If there is no hard Brexit, sterling could rise, and potential buyers are therefore holding off as there could be up to 15% extra to spend in this case,” said Donal Culloty.
Other traditional holiday home destinations such as Bantry are finding a new breed of Brexit buyer relocating from the mainland Europe.
“This year three UK couples relocated from Spain, Portugal and France due to Brexit – all purchasing properties under €200,000,” said John O’Neill of REA Celtic Properties.
Media information: Darren Hughes, firstname.lastname@example.org