Annual house price growth slows to 8.7% in December

Residential Property Prices remain Elevated Despite Cooling Growth

Residential property prices continued their upward trajectory in 2024,although the pace of growth has slowed compared to the previous year. new figures from the Central Statistics Office (CSO) show that average home prices increased by 8.7% in the year to December, down from a revised 9.6% growth in November.

Prices Surge Above Pre-Recession Levels

Despite the moderation, average home prices are now approximately €200,000 higher than a decade ago, with the median price of a home bought in the 12 months to December reaching €355,000. This figure represents a important increase compared to €327,500 in 2023 and €155,000 in 2013. Notably, national prices currently exceed the peak levels seen during the Celtic Tiger property boom in 2007, standing 16.8% higher.

Regional Variations and Price Trends

Dublin experienced a 8.3% rise in home prices in December, while prices outside of Dublin saw a more pronounced increase of 9%. The lowest median price recorded was €182,250 in Longford, while Dún Laoghaire-Rathdown boasted the highest median price at €660,000. The CSO revealed that in Dublin, house prices rose by 8.7% in the 12 months to December, compared to a 6.9% increase for apartments.

Fingal witnessed the highest house price growth in Dublin at 10%, followed by South Dublin, which saw a 6.9% rise. Outside Dublin, house prices increased by 9.3%, with apartments experiencing a 5.8% rise. The Border region (Cavan, Donegal, Leitrim, Monaghan, and Sligo) led the growth in house prices outside Dublin, with a significant 14.2% increase. Conversely, the Mid-East region (kildare, Louth, Meath, and wicklow) experienced the smallest growth at 5.9%.

looking at individual Eircodes, Blackrock (A94) recorded the highest median price at €730,000, while Clones (H23) had the lowest median price at €131,000.

Market Activity and Expert Analysis

Despite the slowing growth, demand for housing remains robust, exceeding supply. Total purchases filed with Revenue in December 2024 amounted to 5,177, a 2.3% increase compared to December 2023. However, full-year 2024 saw a 2.9% decrease in purchases compared to 2023, totaling 48,775.

As the trough in early 2013, property prices nationally have surged by 160.4%, with Dublin prices rising 157.8% from February 2012 lows and prices in the rest of Ireland increasing 171.5% as May 2013.

“While the pace of price increases has slowed slightly, demand remains strong, and supply is still struggling to keep up,” observed Gerry Griffin, Senior Mortgage Advisor at NFP Ireland. “If the ECB proceeds with an interest rate cut in March, as widely anticipated, mortgage rates could fall, boosting borrowing power. While this would benefit buyers, it could also drive further price inflation by increasing competition for available homes. the real issue remains supply—without a significant increase in new housing, lower borrowing costs will likely push prices higher in the short term.”

Griffin emphasized the importance of careful affordability assessments for buyers, noting that even with lower interest rates, repayments will still be substantial. He stressed that policymakers must prioritize delivering more housing at a faster pace to balance the market and alleviate pressure on prices.

Rachel McGovern, Deputy Chief Executive at Brokers Ireland, echoed Griffin’s concerns, stating, “House prices in 2024 rose at levels beyond what most industry commentators expected. There are appalling consequences for our society if policymakers don’t turn around housing in the near future and ensure that those on average incomes can achieve the ambition of owning a home. We would call on the Government to be brave and decisive and not let another year pass before it acts on the recommendations of the Housing Commission.”

Navigating the Housing Market: The current market presents both opportunities and challenges for prospective homeowners. While slowing growth offers a slight reprieve,affordability remains a key concern.Potential buyers should carefully assess their financial situation and seek expert advice. Policymakers, meanwhile, need to prioritize increasing housing supply to address the ongoing imbalance between demand and availability.

What are the key drivers behind the sustained growth in Irish residential property prices, despite a moderation in recent months?

Interview: Residential Property Market in 2024 – Prices, Trends, and Expert Insights

Archyde News speaks with Joseph O’Connor, Economist at the CSO, and Aideen Brosnan, Senior Housing Analyst at NFP Ireland, to discuss the latest trends in the irish residential property market.

• 2024 in Review: Prices and Growth

  Joseph, the CSO’s latest figures show average home prices increased by 8.7% in the year to December, a slowdown from November’s 9.6%. Did this moderation surprise you?

  Joseph O’Connor: Yes, to an extent. While we expected prices to cool, the rapid pace of this cooling caught us off guard.

• National Prices Surpass Celtic Tiger Peak

  Aideen,despite the moderation,prices are now 16.8% higher than the 2007 peak. What’s driving this sustained growth?

  Aideen brosnan: It’s a combination of factors. Low interest rates, robust demand, and limited supply are the key drivers. Despite the slightly slower growth, demand remains strong and isn’t showing signs of waning.

• Regional Variations and Price Trends

  Joseph, Dublin prices rose by 8.3%, while the rest of the country saw a 9% increase. Why the disparity?

  Joseph O’Connor: Dublin’s market is more mature, with higher prices and less room for growth.Other regions, notably those with lower initial prices, still have room to catch up.

  Aideen, the Border region led the growth outside dublin with a 14.2% increase. Why such a notable rise there?

  Aideen Brosnan: The Border region was particularly hard hit during the recession, so we’re seeing a recovery effect. Additionally,working-from-home trends might be drawing people to more affordable rural areas.

• Market Activity and the future

  Aideen, total purchases decreased by 2.9% in 2024. Does this suggest cooling demand?

  Aideen Brosnan: Not necessarily.We saw a significant increase in purchases earlier in the year. As prices rose and supply remained limited, buyers may have been priced out, leading to the decrease.

  Joseph, what’s your outlook for 2025?

  Joseph O’Connor: I expect prices to continue rising, but at a slower pace. The real issue is affordability, and that won’t be addressed until we see a significant increase in new housing supply.

• Thoughts for Potential Homeowners and Policymakers

  Aideen, what advice would you give to potential homeowners in this market?

  Aideen Brosnan: Carefully assess your affordability and seek expert advice. While slowing growth offers a slight reprieve, affordability remains a key concern.

  Joseph, what should policymakers focus on?

  Joseph O’Connor: Prioritizing a significant increase in new housing supply. This is crucial to balancing the market and alleviating pressure on prices.

join the conversation: What are your thoughts on the Irish property market in 2024? Leave your comments below.