House price reality check

PORTARLINGTON based auctioneer Matt Dunne believes the new residential property price register is ‘a great thing for everyone, buyers and sellers’.

PORTARLINGTON based auctioneer Matt Dunne believes the new residential property price register is ‘a great thing for everyone, buyers and sellers’.

Mr Dunne, who has been in business for 28 years, added, “There is now transparency and a detailed valuation base which isn’t based on hear-say.”

He said a similar register is in existence for two decades in the UK and when asked if the Irish register, which merely went on-line recently and covers purchases from January 1, 2010, has come too late for the profession and potential buyers, Mr Dunne replied, “Is it ever too late to do the right thing?”

He said with people struggling to get mortgages, that the wheels of commerce were not turning. “We’ve a bank regulator that is a rottweiler when we need a puppy.”

Mr Dunne did sound a word of caution. “It could be depressing for somebody in a particular estate who may have purchased their property for €200,000 and the one a few doors away was sold more recently for €80,000. That is a serious wake up call, a huge reality check for us all.”

He added, “The value of a house on a particular estate is linked directly to its weakest link yet this can be an unfair reflection of an estate.”
He quoted the example of an estate where a house is repossessed and sold a very reduced cost in a quick sale by the banks.

“That sale is also included in the register and it is transparent but you’d have to take the valuation with trepidation. It is a true reflection of the market? That is where an anomaly might arise,” pointed out Mr Dunne.

Rathdowney auctioneer William Mansfield believes the register is ‘short of specifics’. “I’ve looked through the website and there isn’t enough detail on whether a property is detached or semi-detached, two-storey or as to how many bedrooms it may include.”

Mr Mansfield pointed out that he attended a meeting last Saturday where he and his colleagues expressed a wish for the register to include all information.

“Many auctioneers have concerns as there is a huge difference from one property to the next, whether it is in the centre of Rathdowney or its hinterland. There is also a big difference in the value of property in a town and in a rural setting.”

Mr Mansfield said the register is compiled through information submitted to the Revenue Commissioners and if potential buyers see a figure it may not be a true accurate figure. “You can’t compare like with like.”

Keith Lowe, managing director, DNG, said the new register should not be confused with a house price gauge and suggested that since the register is compiled at the end of the transaction similar to the CSO House Price Index there will be a long time lag between the date when the transaction is agreed and the home purchase completion.

“We would estimate that this time lag is between 3-6 months. This is how long it takes an average sale to complete from taking a booking deposit to handing over the keys on completion of the sale when a mortgage is involved (Cash transations will not have this delay). With this in mind, the register will not act as price guage,” remarked Mr Lowe.