New methodology reveals property crash was more severe than thought

The CSO’s new Residential Property Price Index (RPPI) covers all market transactions in the residential property market and measures price change with greater accuracy.

It represents a significant methodological improvement over the original RPPI as it includes cash purchases of property, higher quality data sources, and more detailed locational characteristics of dwellings.

The new methodology reveals the peak-to-trough fall in residential property prices between 2007-13 was 54.4 per cent, not 50.9 per cent as previously estimated, and prices have gone up an average of 43.2 per cent since 2013, rather than 37.4 per cent.

Gregg Patrick, CSO statistician, said: “The innovative aspect of the new RPPI is the extent to which we have been able to match different administrative data sources for the production of official statistics.

“As a result, the new RPPI provides richer insights into the residential property market. It shows for example that house prices in the Dublin City administrative zone are leading the recovery from the national low point of March 2013 and houses in the Mid-West region have been slowest to recover to date.

“We can also see that first-time buyer owner-occupiers formed a decreasing proportion of the market over the period 2010 to 2015. In 2010, first-time buyers represented 53.1 per cent of all household market transactions filed. By 2015, first-time buyers’ share fell to just 24.4 per cent of the market.

“It also shows that there was considerable variation in average prices across Dublin, depending on the postal district, denoted by the Eircode routing key. With an average price of €733,006, householders paid more for a house in Dublin 6 in 2015 than for any other postal district. The second most expensive district was Dublin 4, with an average house price of €724,535. Householders paid least in Dublin 10, where the average house price was just €157,527.”