The COVID-19 Coronavirus pandemic has seen Ireland and Dublin in and out of lockdowns causing a huge amount of uncertainty for local businesses, the economy, and the property market. One could have easily assumed the property market was set to collapse like during the credit crisis of 2008, but a few interesting factors make 2021’s property market expectations different. Here we will explore them and discuss what speculations are likely to come true.
Where’s the price fall?
Local media (indepedent) and the banks (KBC has probably been the most vocal or quoted) had predicted prices to fall from 5% to 20% during 2021. Mostly on the back of lower GDP numbers and whatever a slide rule can come up with.
But the reality seems to be somewhat masked by a market that is now extremely hard to measure.
The immediate reaction for home owners looking to sell was to withdraw from the market entirely. This has created supply issues for not-new build homes in and around Dublin. And if there are less houses for sale, being sold, there’s not much to measure and gauge.
Why is supply still high?
Dublin has always (recently at least) had housing supply issues courtesy of not just bad planning, but essentially no planning at all. That said and cynicism aside – the Coronavirus pandemic has changed the rationale for high demand somewhat. The working from home revolution being one factor. This alone has seen home and garden product sales go through the roof as people look to make the most of their (confined?) home life. Also, many emigrants are returning to the Emerald Isle as result of Trump, Brexit and similar geopolitical factors.
Where is the boom? Where is the bust?
New homes for sale are now in the best position to capitalise on the sellers withdrawing from the property market. Interruptions to construction developments of new homes for sale in Ireland caused by the pandemic, aside – During 2020 many new builds were finalised and are even increasing prices. While older houses and apartments in and around Dublin don’t offer much space, the prospect of working from home in a bigger house, slightly further out is now more easily considered, and looks to be an advantage new build property developers.
The bust is yet to reveal itself. At least in numbers. While rental prices have gone down, Dublin is still expensive to either buy or rent and that’s unlikely to change for the best part of 2021.