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Soaring home prices and the cost of living are dampening sentiment for homebuyers

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According to a survey by MyHome, appetites have fallen among homebuyers, with nearly nine in 10 saying next year will be a bad time to buy property as rapidly rising prices push more people out of the market.

Just 12 percent of respondents agreed the next 12 months will be a good time to make a purchase, with about three-quarters expressing concern about the state of the property market in general, according to the poll of 2,020 people.

Home price inflation and a general rise in the cost of living this year seem to be behind the gloomy mood.

More than half of prospective home buyers said higher prices in the general economy were affecting their ability to buy a home, and 70 percent lost hope of buying in their preferred location after the price was fixed.

“The rise in the cost of living has been significant and concerns everyone, so it’s not surprising that homebuyer sentiment is negatively impacted in this survey,” said Joanne Geary, Managing Director of MyHome.ie.

Almost six out of ten respondents expect house prices to continue to rise in the next year, which seems to have a negative impact on sentiment among those who don’t own a home.

While 56 percent of respondents said they have finances to buy a property over the next year, a large proportion of them – 42 percent – say they are not confident about making a purchase in that timeframe.

However, pessimism about runaway prices and unmet demand could favor potential buyers if negative sentiment weighs on the market.

“Our most recent home price report for the first quarter of 2022 forecast building materials inflation for next year at 18 percent, which would most likely serve to curb rising market demand,” Ms Geary said. “This could be viewed as a positive outcome for the market as we need to see slacking demand to offset the imbalance between that demand and our chronic shortage of supply.”

The latest report from MyHome.ie/Davy suggested the housing market is not slowing down as national annual asking price inflation is now at 12.3 per cent. House prices are rising by almost €100 a day as the market shows no signs of slowing down, according to the independent Irish REA average house price survey for the first quarter.

The survey found that average home prices nationwide rose 3.16 percent in the first three months of 2022, in line with the 1 percent increase per month during the Celtic tiger boom.

https://www.independent.ie/business/irish/runaway-house-prices-and-cost-of-living-sour-mood-for-homebuyers-41540010.html Soaring home prices and the cost of living are dampening sentiment for homebuyers

Fry Electronics Team

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