I will not complain that the national property price took forty odd years to materialise, nor will I list it’s flaws or limitations. For today, I will be happy and relieved that we finally have some level of transparency in the Irish market and celebrate the fact that buyers are no longer be reliant upon anecdotal market information.
We now know comprehensively the contract date and value for in excess of 50,000 properties, purchased in Ireland, since January 2010.
The information is gleamed from the Stamp Duty records of the Revenue Commissioners and ends (we can only hope!) the monthly and/or quarterly stream of property sales websites reports and CSO indices of mortgage-based transactions. None of the previously available reports were sufficient or complete; property sales websites data comes from asking prices, which might be strategic and duplicated. The CSO indices completed exclude cash purchases, which we knew anecdotally were increasing. By simple comparison of the volume of transactions from the new property price register and those from the CSO figures, we now know that cash transactions account for up to 40 per cent of the current purchases. This is the higher end of the spectrum and will surprise many, not least of all the government who may be feeling slightly more confident about introducing the new property tax in Budget 2012. Ronan Lyons, writing for the Irish Independent today rightly pointed out that the volume of transactions in Dublin this year, in excess of a million euro, exceed the total number of transactions in County Leitrim in total!
While many economists predict that this information will cause a further fall in the market, I believe that the new house price information will set the bar in many areas. Buyers will now use this information to establish genuine market value for the first time, outside of an auction room. Market value will be matched, exceeded or used to put forward lower bids, based upon local supply and demand. In areas of strong demand, where we have already seen evidence of decreased supply, it is unlikely that the priced paid in recent similar sales from the register will be enough to secure existing available properties. Buyers will need to compete. However, if I see an apartment in Longford has sold for €40,000, despite the €65,000 price tag, I am unlikely to advise a buyer to pay a cent over €40,000, in fact, I will probably push for less… This serves to highlight one issue with the register, even taking like for like properties, it does not distinguish between distressed and non-distressed sellers. Market value is an imperfect science but the scope for its abuse and deliberate manipulation has just lessened, and buyers will be surprised by the results.
Buyers, please take note: If the property is a new property, the price shown is exclusive of VAT at 13.5%
View the register at : http://www.propertypriceregister.ie/