Ireland's Property Market - The story so far in 2014 and what estate agents don't tell us

September is a good month for analysing Ireland's property market for the first half of 2014.

As ever, there have been a few industry reports, such as one by myhome.ie, which understandably focuses on the upbeat news that the number of transactions and their value are up on the corresponding period in 2013. On its website, myhome.ie provides fine detail on how asking prices are up pretty much everywhere in the Republic.

Given such fine detail, it is surprising (or not really) that such surveys rarely focus on "average" prices actually fetched when properties were sold, especially in 2014 when it seems the green shoots of a new bubble (excuse the mixed metaphor) seem set to grab the nation again.

Why not? Because the figures are nowhere near as positive as the sector would like us to believe?  Surely not.

All the following figures and graphs are derived from the Residential Property Price Register which records all residential sales in the Republic.

I've excluded all non-full price transactions from the records which can sometimes comprise about 5% of all sales. However, their exclusion should not distort the picture either nationally or at county level to any extent and helps to provide a more accurate figure in relation to property prices. For the same reason, I've added 13.5% to all the prices recorded in the Register for new homes as they are exclusive of VAT. The inclusion of the VAT element provide a better reflection of the true cost of property to buyers.

The RPPR while limited in lots of respects provides us with three of the most important pieces of information about the market -  the number of properties sold in any period, their value and "average" prices. The best measure of what most people label "average" prices is the median price - the figure which provides the mid-value of all prices within a specific range.   It provides a truer picture of what most people are paying for property as it eliminates the distorting effect that a particularly expensive or cheap property would have on the calculation of the traditional average - i.e total value of all properties/ total count of all properties.

First of all - how much business is being transacted?

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So far so good. We can see that the number of property sales in the first 6 months of each year has gone from a low of 7,165 in 2011 to to 15,190 in 2014 - the highest level in five years. The situation with the value of properties sold is similar as evident in the graph below whose curve mirrors that of the number of sales above

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However, the next graph is one which is rarely shown in research carried out by estate agencies....the median price of homes. This graph shows that the average price of homes has not moved in tandem with the general pick-up in activity in the market which became evident in 2012. Instead it has taken until this year for a slight increase in average prices to become discernible with the national median price now up to €149,750 from €140,000 last year

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The picture is even less rosy if you strip away the effect of the surge in prices for property in Dublin which has been created by a scarcity of supply. Now we see that average prices for all parts of the country excluding Dublin have fallen steadily from almost €196,000 in 2010 to €115,000 last year.....and the bad/good news is that the trend is still downward although slowing - with prices down another €2,000 to €113,000 in 2014.

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To get a breakdown of the picture around the country, you can check out the interactive graph below to see average prices in each of the 26 counties. The graph shows the trend in the counties containing Ireland's five largest cities but you can add more. As the graph shows, Dublin is really the only major urban centre to be recording real growth in house prices. As for whether it's another bubble......

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