House prices could fall up to 15% this year

ASKING prices for homes in Galway city are down by one third since the peak of the residential property boom in 2007, and could drop by a further 15% this year, according to a new report.

The dramatic extent of the property price crash – ongoing since the beginning of 2008 – is borne out in a new report from Daft.ie, the country’s biggest property website.

And a leading economist has predicted that asking prices could be set to drop by a further 15% this year.

The report shows that asking prices are down 32.6% in Galway City since the height of the boom in 2007, while those in the county are down 29.5%.

According to the Daft.ie report, asking prices in the city are now averaging €258,930 and €220,334 in the county.

For comparison, the drop in Limerick City was 22.8% (to €197,656); 21.5% in County Limerick (€207,905), Kilkenny down 29.6% (to an average of €226,374), Waterford City down 29.2% (€195,881) and Co. Waterford 26.9% (€237,526).

And while the market here is in a trough, auctioneers are still ‘crying’ out for properties to sell because of demand, particularly in areas like Salthill, Taylor’s Hill and Knocknacarra.

However, according to the new report, the market will remain stagnant unless the Government manage to stabilise the banking sector.

Alan McQuaid, Chief Economist with Bloxham Stockbrokers said: “Although houses have in general terms become more affordable in terms of price, this is of little comfort to potential purchasers if credit is still very tight. As such, it is therefore imperative that the country’s banking system is put back on a sound footing as soon as possible,” he said.

Mr McQuaid also predicted that prices will fall a further 10%-15% during the coming year, with a slight recover possible next year.

Continued on page 4 of this week’s Sentinel