Ireland’s Residential Property Transactions Drop 18% in Q1 Amid Rising Borrowing Costs

Geowox's report sheds light on the significant decrease in transactions following 10 consecutive ECB interest rate hikes. Stay informed on the impact of higher borrowing costs in Ireland's property market.

Residential property sales in Ireland experienced a significant decline in the first quarter of 2024, according to a report by property start-up Geowox. The report highlighted that transactions fell by 18 per cent compared to the same period last year, with a total of 10,213 properties changing hands in January, February, and March. Dublin recorded the highest number of transactions at 3,095, while Leitrim had the lowest with just 85 units sold.

Ireland's Residential Property Transactions Drop 18% in Q1 Amid Rising Borrowing Costs

The decrease in sales was more pronounced for new homes, which saw a 26.1 per cent decline, while existing home sales fell by 16.8 per cent. Despite the drop in transaction volumes, property prices continued to rise, with year-on-year inflation in the market reaching 6.5 per cent. The median price paid for a property in Ireland was €330,000, up from €310,000 in the first quarter of 2023.

Dublin remained the most expensive location, with a median price of €445,000, 56 per cent higher than the national median. Wicklow had the highest median prices at €450,000, followed closely by Dublin city at €500,000. In contrast, Donegal was the most affordable county, with a median price of €165,000.

The report also highlighted the premium placed on energy-efficient homes, which commanded a 22.4 per cent higher price compared to less efficient properties. Despite the overall decline in sales, demand for energy-efficient homes remained strong.

These findings align with the Central Statistics Office's Residential Property Price Index, which reported a 6.1 per cent inflation rate for the 12 months leading up to February. The housing market in Ireland slowed down last year due to tight monetary policy from the European Central Bank (ECB). However, expectations of rate cuts later this year, combined with government help-to-buy schemes, are expected to fuel further price growth.

The real estate market in Ireland is facing challenges due to increased borrowing costs and supply issues. However, the potential rate cuts by the ECB and government support measures could lead to a resurgence in prices in the coming months.