New figures show that the rate of house price growth has risen at more than twice the rate in the five months from July to November than in the first half of the year. The latest edition of the Permanent TSB/ESRI's House price index says that house prices rose by 2.6% in the first six months of the year, while they jumped by 5.4% from July to November.
The index says that the overall value of house prices nationally rose by 8% in the first eleven months of the year. This compares with an increase of 8.4% the same time last year. However, it points out that the rate of increase towards the end of 2005 is accelerating while price growth was slowing down this time last year.
Today's index also reveals that the cost of houses for first time buyers has grown faster for the first 11 months of the year than for any other market sector. Prices for first time buyers have now risen by over 4% more than price growth nationally.
The price of houses for first time buyers rose by 12.1% over the first eleven months of 2005 compared to an increase of 7.1% for second time buyers with the average price paid for a house by a first time amounting to €248,113.
The house price index shows that national house prices rose by 1.2% in November. That was unchanged from October and was four times the rate the same time last year. The average price for a house in November of this year was €274,507.
'This has certainly been a year of two halves with price growth strengthening considerably as the year went on,' commented Niall O'Grady, head of Marketing at Permanent TSB. 'Looking ahead to the year end, we now anticipate that price growth for the year will come in at around 9%, slightly higher than that recorded last year (8.6%)', he said
Mr O'Grady said he expects that price growth in the New Year will continue at similar levels to that seen this year. He says that prices will be buoyed by continuing strong demand and strong employment growth.
'The recent interest rate rise and the potential for further rate rises may impact to some degree as the year goes on, though there is no need to suggest that this will have any dramatic impact on demand for the foreseeable future,' he added.
The index shows that Dublin house prices grew by 9.6% in the 12 months to November, while growth of 7.4% was recorded outside of Dublin. The average price paid for a house in Dublin and outside Dublin last month was €365,562 and €237,149 respectively.
House prices in the commuter counties of Dublin - Louth, Meath, Kildare and Wicklow - grew by 0.8% in November, compared to a fall of 0.5% the same time last year. The index said that growth in the first 11 months of the year has been relatively strong in the commuter counties - up 8.6%.
Three bedroomed semi-detached houses grew by 8.9% in the 12 months to November, up from the 7.4% growth rate the same time last year.
Today's index show that over the first 11 months of the year, house prices for first time buyers grew by 12.1%, while for those trading up prices were up by 7.1%. This rate of growth can be partly explained by the increasing percentage of first time buyers buying existing as opposed to new houses.
The average price paid by a first time buyer and a second time buyer in November was €248,113 and €307,640 respectively.
