Irish Lilt

The Irish housing market is set to outperform global property trends over the next two years. George Banns spoke to top-tier industry experts to find out more

With its stunning countryside and rugged, come-hither landscape, Ireland never fails to disappoint. Steeped in heritage, stately mansions, castles and country manors proudly retain their historic character, immersed in wide expansive lush green fields, all the while telling a tale of the Emerald Isle.

Much of Ireland’s appeal is down to its strong sense of community and the local inhabitants who are notoriously friendly, warm and welcoming, making it the ideal choice for buyers wanting a family-orientated property with plenty of land. Contemporary homes located in lively capital Dublin, attract elite homebuyers and Cork is another popular hub renowned for its Arts and Crafts scene and internationally renowned music festivals.

As to property yields, MyHome confirms average prices rose 0.6% in Q3 2023, up for a second successive quarter, with annual inflation accelerating to 4.1%. Even in Dublin, where valuations have become most stretched, asking prices rose 1.3%, an increase of 3% on the year. As to 2024, estate agents and valuers are expecting housing completions to quieten, amid labour shortages and construction cost inflation, despite a sharp uptick forecast in commencements in the first half of the year.

I caught up with David Ashmore, Director of Country homes and estates, Lisney Sotheby’s International Realty, to get more of his insight

How are property prices being affected?

It’s difficult to make sweeping claims about the luxury property market. Prices vary enormously based on home type and region and the headlines about price drops, don’t  always impact properties at the top end. However, it’s true that buyers are becoming much more price sensitive, unwilling to even view properties with asking prices past their perceived correct banding. It has been notable in recent times how quickly demand for a property improves when the asking price is reduced by as little as 5%, clearly demonstrating the narrow margins buyers are working off.

What’s availability of high-end housing stock like?

Supply of the right homes for luxury buyers has been a chronic issue. This has been exacerbated recently by many vendors taking a ‘wait-and-see’ approach to selling their home, looking to move past the period of high interest and cautious buyers that we are currently experiencing. A catch-22 situation has emerged where potential vendors cannot sell until they buy and, sometimes, cannot buy until they sell. This restricted portfolio and a strong supply of cash-based prospect buyers has seen sales activity remain robust and insulated, so far, from wider macro-economic and political concerns.

Where are Ireland’s top locations for HNW buyers?

Our coastline is known across the globe for its rugged natural beauty and is home to some of the most desirable homes in Ireland. Top locations include County Kerry and West Cork in the south west, known for their spectacular ocean vistas and rich cultural heritage. The west coast, including counties Clare, Galway, Sligo, Mayo and Donegal, is becoming increasingly popular.

Best piece of advice for house hunting in the current market?

Cash buyers have the advantage. Although this may not be an option available to everyone, sellers tend to prefer the security that comes with this category of purchaser. If you can offer slightly over the asking price, this will likely tip the balance in your favour, as other finance dependent buyers will be extremely price sensitive. While luxury buyers will pay heed to market conditions, they also understand the sub-market subtleties and often justify qualified risks on market movements that others dependent on borrowings, may be unable to do.

Outlook for 2024?

The Economist predicts that Ireland will be the top performer of 16 global housing markets in the coming year, noting that while Irish homeowners may still be “scarred by their losses,” during the financial crisis more than a decade ago, the strength of economic data suggests that the Celtic Tiger looks poised to reawaken.