Back to School for the Irish Property Market
Ireland’s House Prices still heading towards our 10% Year End Forecast Demand, bidding wars with sale agreed 15%-20% over asking are back and lower rates / more competition in the market all support continued price
increases
We could write this every month…. demand has never been higher.
ECB Interest Rates & Irish Bank Rates
There is an expectation of some modest cuts to the ECB rate end but we think its unlikely you will see major reductions in the 3 pillar banks in Ireland rates. What we are seeing is the non Bank lenders like ICS and Finance Ireland cut their rates and we expect them to come more into line with main banks at the end of this year. These lenders offer much more flexible products and it will be great news from a competition standpoint to see them back in play….. however this will boost demand for mortgages …. increasing Irish house prices.
Irish Economy / Housing Demand
Remains strong ….(but).
Could there finally be a cooling down coming ? Retail, Restaurants and some other discretionary spending sectors of the economy are begin to show signs of trouble. The constant increase in prices cant go on forever and we may be seeing the peak in prices – we wouldn’t be surprised if inflation were now to fall below the 2% target. The Irish Economy is ultra reliant on the US multinationals – far more than is even reported with our estimate that ~60% of all taxes collected in Ireland has some link back to US multinationals. The Income tax and Vat paid by their employees is staggering as a percentage of total tax. Any issues in this sector of the economy and all bets are off on growth. But until year end we expect the economy to remain strong with a stable jobs market. 2025…. not so sure at this point. We are yet to form a firm view on 2025 property prices growth but it wont be plus 10%. That said if there are some crazy giveaways in the
Budget around housing….. which can never be ruled out with an election coming.
What’s next for the Irish Property market?
Switching Mortgage.
This will be the big theme in the coming 12 months. Lots of people locked in 3/4 year fixed deals in Covid and those 2% rates are now rolling off and people are getting a massive shock with the new offerings from their Banks. When your fixed rate ends you should always look around for a better offer but also if you are planning any borrowing in the next 12-18 months for some work on the house a new car or another personal loan you should really do this as an equity release from your house… its much better for you in the long run. Too many people end up with personal loans that cost them €600,€700 a month and put themselves under huge financial pressure. Ireland’s property market has a huge amount of equity now and if used properly could be greatly beneficial
“If you are a property owner releasing equity is best way to fund any major expenditure you have coming up.”
If you would like an initial consultation to assess how much you can borrow/save
and what your pension, insurance and investment options are please contact us
info@pangeamortgages.com or call 01-442 5064 // 085-8600728
