A significant lack of supply, coupled with a big increase in household savings, has seen property prices skyrocket over the past year. In June, MyHome.ie published the Property Price Report for Q2 2021 reporting an asking price inflation of 13%. Asking price inflation is the most reliable lead indicator for actual property prices, and predictably, CSO figures released last month showed that there had been a 12.4% increase in residential property prices nationwide in the year to September 2021. Last month, the CSO reported that the volume of transactions in September was up 14.3% on August and by 34.8% compared to September 2020. Existing houses accounted for 86% of transactions, a rise of 43.2% over the year, while new homes accounted for 14%, which was flat compared to last year. The Banking and Payments Federation Ireland (BPFI) said there were 11,479 mortgage drawdowns in Q3 2021, valued at €2.8bn. This means volume was up by 40.9% year on year and the value of mortgage drawdowns was up by 42.3%. This activity is reflected in the level of interest in the market: MyHome.ie website traffic has increased by 40% over the course of the pandemic. In addition, and according to Ulster Bank’s construction purchasing managers’ index, the sector expanded for the sixth consecutive month in October 2021, despite the increase in the cost of building materials. The Business Post, 12th December 2021
