Property prices plummet as the market reflects a new reality.
According to the latest report from property website Daft.ie, property prices fell by almost twenty per cent in 2009.
Prices are now thirty per cent below their peak levels in 2007. These figures are averages, so the actual fall in prices can be much higher. In the summer of 2007, a property in Dublin 6 sold for €2.25 million and today it is back on the market for €1.25 million, a reduction of around forty four per cent.
However, there is a gap between asking prices and selling prices which means that the true reduction in overall prices could be as much as fifty per cent.
According to Ronan Lyons, Economist for Daft.ie,
House prices during the course of 2009 fell by about 19%. That compares to a fall of 15% in 2008.
The largest fall in asking prices has been in Dublin closely followed by Galway, Waterford, Cork and Limerick.
Keith Lowe, Chief Executive of estate agents Douglas Newman Good, believes that the true price reduction is closer to fifty per cent.
The average selling times in the Leinster region is seven months and in other regions nine months. In Dublin, it currently takes four months to sell a typical property.
There has also been a twenty per cent fall in the number of properties available for sale, according to the report.
David Duffy, Economist with the Economic and Social Research Institute (ESRI), believes that while we can expect further declines in the coming year, we are closer to the bottom of the slump. The ESRI expects to see some return to economic growth in the second half of 2010 but believes it will be 2011 before house prices begin to recover.
An RTÉ News report broadcast on 7 January 2010. The reporter is Mary Calpin.