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House prices soar by over 7% across the country

House prices climbed by 7.7% across Ireland this year with the average home costing €290,998.

The new data from Daft.ie showed the rural/urban split continued with prices for country properties rocketing by far more than in cities.

While 2020 saw similar rates of inflation across the housing market, significant regional differences emerged during 2021.

Economist Ronan Lyons said: “Inflation in listed prices continues to cool from its mid-year peak.

“Nonetheless, at nearly 8% for the year, it remains stubbornly high.

“This reflects a combination of unusually strong demand and ongoing weak supply.

“Demand for homes to buy, which had been strong anyway from the mid-2010s, has received an unexpected boost during the Covid-19 pandemic, with prospective buyers able to tap into ‘accidental’ savings, as expenditure fell during the lockdowns.

“Meanwhile, both new and second-hand supply remain weaker than expected before the pandemic.

“While the pandemic has changed some particulars, the general health of the housing market is largely unchanged – it is characterised by weak supply in the face of strong demand.

“For that reason, additional supply – not just of homes for sale but also of market and social rental housing – remains key to solving Ireland’s chronic housing shortage.”

In Galway city, prices rose by 1.6% during the year, while in Dublin, they went up by 3.4%.

In Cork city, prices rose by 5.5% while in Limerick and Waterford cities, the increases were 6.4% and 7.5% respectively.

But outside the five main cities, prices rose by an average of 11.5% during 2021.

The increase in Munster (outside the cities) was 9.2%, while in Leinster excluding Dublin, prices rose by 11.9%.

The largest increase in the country was seen in Connacht-Ulster, where prices rose by 14.6% during 2021.

And less than 11,500 were up for sale on December 1, the lowest total seen since July 2006 when online advertising was still emerging.

The total number of advertisements of properties for sale in the year to December 1 was just over 54,000, the highest 12-month total since early 2020.

While supply has improved, it remains well below pre-pandemic levels – with almost 70,000 homes listed for sale during 2019.

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