LPT: Valuation : Price Ratio between 3 and 4 Bed Houses

A

Aeneas

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Is there a generally accepted price ratio, or rule of thumb, between three and four bedroom houses in the Dublin area? I ask this because I remember seeing on the daft.ie website a comment that three-bed houses are normally about one half the price of five beds and that this ratio is pretty consistent.
 
I wouldn't think so, too many other variables at play the chief one being location. There might be a rule of thumb within each location between 3 and 4 beds.

Are you trying to figure out the price of your house by comparing it to a 3/4 bed in your area?
 
I'm doing comparisons for my area. I agree that location etc is critical in determining price levels but the issue here is ratio when other factors like location, services are much the same. I was struck by the comment on daft ie about 3 bed/5 bed and wondered if in the property industry there was a rough rule of thumb for 3 bed/4 bed ( other things being equal).
 
I can't say about absolute costs, but regarding costs per square metre there is a general trend outside Dublin that the cost per square metre goes down as the number of bedrooms go up. It seems to be an economy of scale thing. In Dublin, this trend is reversed. The cost per square metre is higher for 4 and 5 bed houses compared to 3 beds. This may relate to a shortage of supply of this type of home in Dublin. Obviously there are many other factors in each individual case, but this information is based on an analysis of asking prices across thousands of houses.
 
I would imagine the OP is correct and there is a ratio. I do not know what it is though.
 
This time two years ago there was a 12% premium in asking price per square metre (not total price) of 4 bed houses in Dublin compared to 3 bed houses, based on a sample of more than 1,500 properties. Sorry, I haven't checked for more up to date figures since.
 
dub_nerd said:
This time two years ago there was a 12% premium in asking price per square metre (not total price) of 4 bed houses in Dublin compared to 3 bed houses, based on a sample of more than 1,500 properties. Sorry, I haven't checked for more up to date figures since.
Click to expand...

Mad!

Upstairs in our house we have about 50sqm. About 12sqm is taken up by landing / stairs. The bathroom is about 5sqm and the 4 bedrooms are 12sqm, 9sqm, 7sqm and 5sqm.

My initial intention when I bought was to completely renovate the upstairs so we'd have a better sized bathroom and 3 good sized bedrooms. I didn't get round to it in the end - just as well because a small bedroom is a good idea for a baby.

In the very long run I'd still consider it as it would be a better lay out for a grown up family, but between renovation costs and reduction in market value I could end up €100k out of pocket if my intention was to sell the house!
 
dub_nerd said:
This time two years ago there was a 12% premium in asking price per square metre (not total price) of 4 bed houses in Dublin compared to 3 bed houses, based on a sample of more than 1,500 properties. Sorry, I haven't checked for more up to date figures since.
Click to expand...

Actually, I lied. I do have more up to date figures, in fact, every quarter for the last two years. There has been a consistent 12% premium in asking price per square metre for 4-beds compared to 3-beds in Dublin. 5-beds carried an additional 10% premium over 4-beds two years ago, but this has fallen to 5%. Interestingly, 2-beds are also more expensive per square metre than 3-beds -- but the differential has fallen from 12% to 3% over two years. My hunch would be that 3-beds are the traditional starter home and the supply of these is greatest. Figures are based on asking prices from myhome.ie on approximately 1,500 Dublin houses each quarter.
 
Thanks. That's very interesting. Since the 12% premium is per sq m this means that the differential between the price of 3 bed and 4 bed houses is even higher, since on average four bedroom houses are larger. If there were a figure for the average difference in size it might be possible to work out the house price ratio ( as distinct from the sq m ratio) in the Dublin area.
 
Actually, I have that data too. On the same sample of 1,500 houses across all Dublin, the average asking prices were:

Jan'11, 3-bed: 313k
Jan'11, 4-bed: 493k
Jan'13, 3-bed: 258k
Jan'13, 4-bed: 431k

On average a 3-bed is asking about 60% of the price of a 4-bed. Conversely, 4-beds are about 65-70% more than 3-beds.
(Bear in mind asking prices were significantly above selling prices in 2011).
 
Thanks for that. I looked up the myhome.ie website and selected all three and four bedroom semis in South Dublin. As of today there are 121 3-beds for sale at an average asking price of €371,902. And 116 4-beds at an average price of €579,563 which gives a price ratio of 64%. The fact that the numbers for sale in the two categories are broadly the same helps, I think, with the comparison. However, a number of the 4-bed semis are priced at over one million, mainly very large houses in places like Sandymount and Ballsbridge and untypical of semis elsewhere. When these are stripped out the average asking price for a 4-bed semi in South Dublin falls to €508,311. This gives a price ratio of 73%.
These are of course asking prices, but what I am interested in is the ratio rather than the actual price level. I think it would be reasonable to assume that the ratio would be much the same even if the selling price is reduced.
 
I can confirm from talks last week with two local EAs that 4 bedrooms of whatever size are worth more than 3 bedrooms -even to the point where the 3 bedroomed house is slightly bigger than the 4 bedroomed house.

I'm considering selling a 4-bedroomed rental house in D20. The fourth "bedroomed" is so tiny that I always rented it as a 3 bedroomed house "with study."

I told the EAs that I felt it wrong to sell it as a four bedroomed. Absolutely you must , they both said. It'll add 30k on the average 230k price range on the street.
Even the 3 bedroomed houses with decent ground-extensions wouldn't be worth the extra 30k.

The cray thing is that the other three bedrooms are slightly smaller than the three bedrooms in neighbouring houses which I thought would affect the selling price. But, not so. A fourth bedroom , even only suitable for babies or midgets, adds a lot to the price.

(on a seperate note, sales prices for the area have increased a small percent in the last year which surprised me for D20, as opposed to SCD)
 
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