Two bedroom apartments are Limerick’s best sellers

IPAV chief executive Pat Davitt

TWO-bedroom apartments were the best sellers in the Limerick housing market last year, achieving a 6.56 per cent increase on the 2020 average sale price.

That’s according to the latest figures from the Institute of Professional Auctioneers and  Valuers (IPAV), which captures house prices actually achieved by auctioneers for three and four bedroom semi-detached homes and two-bedroom apartments.

Limerick saw a 4.57 per cent increase in the three bedroom category in the latter six months of the year; 4.44 per cent  for four-bedroom houses and 6.56 per cent  for two-bedroom apartments.

Two-bedroom apartment achieved an average sale price of €162,500 based on 2,337 sales;  three bedroom semi-detached houses averaged €257,500 based on 2,565 sales while four bedroom semi-detached houses averaged €293,750  from 2,384 sales.

Despite the price rise, Limerick two bedroom apartments sold for less than similar properties in Galway (€225,000) and Cork (€238,750).

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IPAV chief executive Pat Davitt said that during 2021 in particular the differential between asking and achieved prices was crucial, given the intense demand against a scarcity of supply, leading to a trend whereby agreed prices often exceeded asking prices, sometimes to a considerable degree.

“However,” he said, “there is a myriad of factors impacting the market, with many buyers, particularly those with family connections to the country, now seeing living in the country as a realistic, more affordable option given the new hybrid working arrangements.”

“However, the current market favours those on higher incomes and those fortunate enough to have family support.”

He said in some cases it’s also preventing potential sellers from placing their properties on the market in case they would not find a suitable home, or that by the time they do, the price they would have to pay may have outstripped their planned budget.

IPAV has sought adjustments to the Central Bank mortgage rules, particularly to assist those on average incomes who could afford to service a mortgage, “if only they could get one.”

Mr Davitt said supply is improving but so far not quickly enough.

“We need to see measures that tackle severe planning impediments, the tax take on buying a home where mortgage holders borrow money and pay interest on those borrowings for the lifetime of the mortgage to cover upfront VAT charges.”

“Unless these issues can be dealt with without further delay, the storm clouds of rising inflation could scupper many prospective buyers. While the ECB is not predicting an interest rate rise for 2022 that situation will change, hampering the ambitions of some buyers but also impacting house prices, which for now look like continuing on an upward trajectory,” he concluded.