House prices soar by 8.4% in a year, new report finds

House prices have risen by 2.4% in the Republic of Ireland since the year began, according to a report.

A study by property website Daft.ie shows prices continue to go in an upward trajectory across the country, with the average price of a home nationwide now just over 299,000 euro in the first quarter of the year – an 8.4% increase on the same period last year.

The report shows that the average price nationwide is only 19% below the peak seen in Ireland during the Celtic Tiger.

Trinity College Dublin economist Ronan Lyons, who authored the report, said: “Inflation in housing prices remains stubbornly high – with Covid-19 disturbing an equilibrium of sorts that had emerged, with prices largely stable in 2019 but increasing since.

“As has been the case consistently over the last decade, increasing prices – initially in Dublin and then elsewhere – reflects a combination of strong demand and very weak supply.”

Prices rose in cities across Ireland.

In Dublin, prices rose by 4% bringing the average price of a house to over 415,000 euro.

In Cork, house prices rose by 3.9% to sit at an average of over 318,000 euro.

In Waterford, there was an increase of over 9% in prices – with the average home now selling for nearly 219,000 euro.

As of the start of March, the Daft.ie report found only 10,000 homes for sale across the country.

That figure is significantly below the average in 2019 of 17,500.

Dr Lyons added: “Both new and second-hand supply remain weaker than expected before the pandemic.

“Combined with unexpected strong demand, due to accidental savings during lockdown, this has driven up prices.

“Additional supply – of all types of homes, for sale but also market rental and social rental housing – remains the only real solution to solving Ireland’s chronic housing shortage.”