Dichotomy in property – apartments versus houses

The recent liquidation sales have possibly started a new trend in the property market in Ireland, one whereby there is an increasing divide between the valuations in different types of property, we have long been saying that the only market worth considering is non-apartment second hand homes in cities, the liquidation sales have reinforced this belief.

While we may be part of Europe, when it comes to living spaces we believe that Irish people favour houses to apartments, we have not crossed that particular Rubicon just yet and unlike our European counterparts, there is still a wish to own the land under the dwelling, over time this may change, but with the exception of the bubble-times the overwhelming mortgage for a first time buyer was used to purchase a house and not an apartment.

The situation regarding the property market in Dublin (for instance) will likely be one where apartments are seen as a totally separate market, in the past many newly built apartments were not priced on a totally dissimilar basis to houses of comparable square footage in the same vicinity, this trend is not likely to continue.

The removal of stamp duty for first time buyers removed the bias for new build (a badly created bias as the stamp was normally reflected in [built into] the purchase price and the majority of newly built property stock was apartments. Further to this are the ongoing management fees and closer living conditions which many people find unattractive, in a terraced house you might have neighbours to either side who are noisy but in an apartment that can happen on four sides (both up and down as well), and the square footage and floor plans were often created in order to lend to maximum density of units rather than maximum benefit for the inhabitant.

It is for reasons such as these that we suspect the market will start to divert from a general view of ‘common housing stock’ (when you look at square footage) into one where there are very different valuations for specific property types. There always was a divergence, but we think that is set to widen. Soon we hope to put this into hard numbers, for now it is just a prediction

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