Property prices are "only going one way" after they rose nationally by 5.4% in the 12 months up to January, data from the CSO has revealed. 

Prices climbed by an average of 4.5% in Dublin, while in the rest of the country they increased by 6.1%. 

Speaking to Newstalk Breakfast, Institute of Professional Auctioneers CEO Pat Davitt said the trend has accelerated since then. 

“We do a barometer report every six months,” he said. 

“If we did it at the end of March, we would find that right across the [areas] outside of the city of Dublin, that prices have gone up already this year by 5%. 

“In some areas, they’ve gone up between 5% and 10%.” 

Houses in the Belcamp Manor estate in north Dublin. Image: Occu

In January, the median property in Dublin cost €445,000, whereas nationwide the figure stood at €330,000. 

Despite this, Mr Davitt said the gap is narrowing between prices in the capital and the rest of the country. 

“Prices are moving on outside of Dublin because a lot of prices are still well behind 2006 [levels],” he said. 

“They’re well behind the Dublin prices; the Dublin prices did surge - so, now a lot of property prices outside the city are surging.  

 “I was talking to an agent in Clare recently and he tells me that house prices there have gone up by as much as 15%.”

Seafront houses in Kerry.

Mr Davitt said he believes the trend of ever-increasing house prices “doesn’t look like it’s going to reverse anytime soon”. 

“For two reasons, interest rates, we believe, are going to start to come down and, as well as that, there are a lot of extra people coming into the country buying properties, maybe as investments, maybe coming back into Ireland. 

“If that continues, prices are only going to go one way and they’re going to continue to go up.” 

Solution

Last year, close to 33,000 new homes were completed in Ireland but Mr Davitt believes that figure could be increased if there was more support for small builders. 

“We need to increase the supply but small builders in the country who are building and have built houses for many years in Ireland, they’re not to be seen,” he said. 

“There’s only [a] number of bigger builders throughout the country and they’re the only people who are building houses. 

“The typical type of person who we saw building maybe five, 10, 20 houses per year, they’re not there anymore. 

“Government did not give them finance to get them into a situation where they could operate.” 

Property prices are now 8.2% above their peak in April 2007.

Main image: Houses.