Ireland's Property News
Irish property prices post second monthly rise
Irish house prices grew for just the second time in five years in July, rekindling hopes that the market may be bottoming out after a slump of as much as 50 percent.
Irish property prices have fallen 50 percent peak to trough in the past four years after a property bubble burst spectacularly, leaving banks with huge losses and homeowners with hefty mortgage repayments.
Economists say at least a stabilisation of property prices is vital to allow both Irish banks and households to get back on their feet and generate the economic growth needed to begin to pay off debts that have forced an EU rescue of the country.
Average residential property prices in May posted their first rise since 2007, but fell by 1.1 percent the following month.
On an annualised basis, they rose 0.2 percent on the month in July and fell 13.6 percent in annual terms, their lowest rate of decline in 12 months, data from the central statistics office showed.
"It's far too early to make any definitive judgement, but the broad picture emerging is one of a tentative stabilisation," said KBC chief economist Austin Hughes.
"There is a consistent message across a range of domestic economic indicators that things have stopped getting worse though that doesn't mean there will be a dramatic turnaround."
Irish consumer sentiment surged in August to its highest, level since before the country's financial crisis, but economists cautioned that would not necessarily translate into higher spending.
Other data on Thursday showed that trips made abroad by Irish residents fell for the fourth straight quarter.
Residential property prices in Dublin, which have fallen 57 percent since their 2007 peak, fell 0.3 percent in July, their second fall in five months, while property in the rest of the country rose by the same amount.
Economists polled by Reuters expect national property prices to fall by 12 percent in total this year before stabilising in 2013. [ID:nL6E8J8A6O] That would go some way to easing concerns over a huge wave of defaults that would generate further significant losses for state-owned banks.
A total of 524 million Euros of mortgages were drawn down in the three months to June, up from 450 million in the first three months of the year, but down from 624 million in the same period last year, according to data from the Irish Banking Federation, which was released last week.
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