Should the €220k threshold be increased in Dublin?

[Brendan Burgess]

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

 

[trasneoir]

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.