Should the €220k threshold be increased in Dublin?

Discussion in 'The Central Bank's 2016 review of mortgage limits' started by Brendan Burgess, Sep 1, 2016.

  1. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    34,864
    I have seen this point argued a few times. Here is an example from the IPAV submission

    "Impact of Macroprudential Rules
    The rules one-size-fits-all approach does not recognise market realities, therefore they have a more severe impact in Dublin particularly on potential house buyers, renters and economic growth

    Supporting Evidence
    Dublin prop prices – ahead of rest:

    DNG: Residential Market Review Q2 2016:

    - Average Dublin Second Hand Price €383,406

    - Average Dublin Apartment Price €263,978

    DAFT: The Daft.ie House, Price Report, Q2, 2016:

    - Average asking prices across Ireland: sample: Longford €68k, Galway €93k, Tipperary €99k, Carlow €104k, Meath €156k, Kildare €168k

    - Dublin’s own market: Average asking prices: D4 €597k, D3 €404k, D7 €326k, D22 €214k

    IPAV Recommendations
    Increase the property threshold from €220,000 to €350,000 in Dublin"

    First Time Buyers are not average buyers. They should not be expecting to pay €383k for a house in Dublin.

    A starter home should be probably around 60% of the average price? That would be €230k for a house. Apartments are often regarded as starter homes. If the average is €263k, then there must be many below the €220k threshold.

    Brendan
     
  2. trasneoir

    trasneoir Frequent Poster

    Posts:
    318
    The rules may have had a cooling effect on residential property inflation. If that equates to "impacted economic growth", so be it.

    IPAV Recommendations
    It's hardly surprising that the industry is advocating a measure which would allow more money into the industry. I'd take their recommendations about as seriously as turkeys recommending goose for Christmas.

    As a hurler on the ditch (and presumed future first time buyer), I see the first time buyer exemption as a (politically) necessary evil, which should be rowed back gradually.