THE HOUSING MARKET Opportunities & Challenges Cork - NOVEMBER 2021
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THE HOUSING
MARKET
Opportunities & Challenges
Cork
NOVEMBER 2021
CONTENTS 01 ECONOMIC AND POLITICAL BACKGROUND 01 02 HOUSING FOR ALL 03 RESIDENTIAL MARKET
01 ECONOMIC AND POLITICAL BACKGROUND
GDP & MODIFIED DOMESTIC DEMAND
ANNUAL PERCENTAGE
01
SOURCE: CSO/DOF
UNEMPLOYMENT RATE
2009 Q1 – 2022F
01
SOURCE; CSO / DOF FORECASTS
CONSUMER SENTIMENT INDEX
OCTOBER 1997 – OCTOBER 2021
SOURCE: KBC
CENTRAL BANK
PROPERTY MEASURES
LOAN TO VALUE LOAN TO VALUE LOAN TO INCOME
(LTV) FOR PRINCIPAL (LTV) FOR BTL (LTI) FOR PDH
DWELLING HOUSES MORTGAGES MORTGAGES
(PDH)
PDH mortgages for non-first time buyers BTL mortgages are subject to a limit of 70 PDH mortgage loans are subject to a limit
are subject to a limit of 80 per cent LTV. per cent LTV. of 3.5 times loan to gross income.
For first time buyers of properties a This limit can only be exceeded by no more Taking effect on the 1st January 2018, the
maximum LTV of 90 per cent will apply. than 10 per cent of the euro value of all Central Bank has made revisions to the
housing loans for non PDH purposes Loan-to-Income Allowances.
These LTV limits should not be during an annual period.
exceeded by more than 20 per cent of From this point on only 10 per cent of the
the euro value of all housing loans for value of new mortgage lending to second
second and subsequent PDH purposes, and subsequent buyers can be above the
and not be exceeded by more than 5 LTI cap, while 20 per cent of the value of
per cent of the euro value of all housing new mortgage lending to first time buyers
loans for first time buyers, during an can be above the LTI cap.
annual period.
Previously, the LTI limit was not to be
exceeded by more than 20 per cent of the
euro value of all housing loans for PDH
purposes during an annual period.
GDP & HISTORICAL HOUSE PRICES 1996 – 2020F Sherry FitzGerald Research / CSO
GOVERNMENT INITIATIVES
HELP TO BUY SCHEME
From launch to 2nd of November 2021
72,499 29,599 28,757 75%
Applications At Claim Approved by
stage Revenue
Of those at claim stage
Dublin 7,387 Cork 3,603
Meath 3,553
75% of claims in the
Galway 1,405 €151,000 - €375,000
Kildare 3,270 Limerick 971 range
Wicklow 1,272
Source: Revenue/Sherry FitzGerald Research
02 HOUSING FOR ALL
HOUSING FOR ALL – PROJECTED HOUSING OUTPUT
HIGHLIGHTS
Project Tosaigh
Croi Conaithe – Cities
Croi Conaithe – Towns
Shared Equity Scheme
Large Scale Residential Developments
Land Value Sharing02 RESIDENTIAL MARKET
MARKET ACTIVITY - VOLUMES
2020
Ireland
46,200
(2.4% of private stock
transacted)
Cork
5,100
(2.3% of private stock
transacted)
Source: PPR/Sherry FitzGerald ResearchVOLUME OF SALES – PRICE CATEGORY
H1 2021 VS H1 2020 – H1 2020 VS H1 2019
Total Sales were up
+29%
for H1 2021 vs
H1 2020,
This compares to
+1%
vs
H1 2019
Source: PPR/Sherry FitzGerald Research *Excludes multi-family/block sales and roundedPROFILE OF PURCHASER
2ND HAND STOCK – YTD Q3 2021
Ireland Cork
Owner Additional Owner Investment Additional Other
Investment Other
Occupation residence Occupation residence
7% 10%
14% 1% 16% 2%
78% 72%
Source: Sherry FitzGerald ResearchFUTURE DEMAND
DEMOGRAPHIC PROJECTIONS
Ireland South-Wes
t
4.76m 690,600
2016 2016
5.04m 724,300
2021 2021
5.32m 756,800
2026 2026
5.57m 785,600
2031 2031
5.81m 812,800
2036 2036
Source: Central Statistics OfficeFUTURE DEMAND
REGIONAL DEMOGRAPHIC PROJECTIONS
Border
3,100
37,000
Average PA
West
2,800 Dublin
Midlands 9,100
3,250 Mid-East
7,500
Mid-West
3,250 South-East
3,000
South-West
4,950
Source: CSO/Sherry FitzGerald Research20
HOUSING COMPLETIONS
1971 – 2021(F)
20,676
new dwellings
completed in 2020
down Y-O-Y by 1.9%
21,087
New dwellings new dwellings
20,676 no. of new dwellings completed in 2020 completed in 2019
up Y-O-Y by 18%
Source: DOHPLG/CSONEW DWELLING COMPLETIONS
YTD Q3 2020 V YTD Q3 2021
Completions in
Cork down from
1,656
in YTD Q3 2020
to
1,580
in YTD Q3 2021
Ireland Dublin Cork Galway Limerick
+3% +4% -5% +28% +26%
Source: CSOPRIVATE STOCK ADVERTISED FOR SALE
JULY 2021
17,100
second hand units
advertised for sale in
July 2021,
down -6% Y-O-Y
2,100
second hand units advertised
for sale in Cork,
up +2% Y-O-Y
0.9%
Total second-hand units advertised for sale represent 0.9% of total housing stock
.
Source: Sherry FitzGerald ResearchVENDOR ANALYSIS - CORK
YTD Q3 2021
Relocating in Ireland
18%
13%
28%
Smaller House Selling Investment
4% 28%
of vendors
Relocating “selling investment”
16% 6% 13%
Abroad
2%
Executor Other Larger House
Sale
Bank
Source: PPR/Sherry FitzGerald Research
RepossessionSECOND-HAND HOUSE PRICES
Q3 2020 – Q3 2021
Prices rose by
5.5%
in Dublin from
Q3 2020 to Q3 2021
Compared to a
11.0%
increase outside of Dublin
Source: Sherry FitzGerald Research03 OUTLOOK
PROJECTED TRANSACTIONS
2011 - 2022
Second – hand sales
47,000
for 2021
and
48,400
for
2022
Source: CSO/Sherry FitzGerald Research5 YEAR HOUSE COMPLETIONS
2022-2026
2022f 2023f 2024f 2025f 2026f
Completions 26,000 29,000 31,000 33,000 35,000
Demand Forecasts
30,900 30,900 30,900 30,900 30,900
National (2022-26)
Source: Sherry FitzGerald ResearchPRICE PERFORMANCE
2021 - 2022
Dublin Nominal Capital Value Ireland Nominal Capital
Performance Value Performance
2020 +0.5% +1.2%
2021f +7.0% +9.5%
2022f +4.5% +6.5%
2 Years: 2021 – 2022f +11.8%* +16.6%*
Source: Sherry FitzGerald ResearchTHANK YOU
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