Updated Estimates on the Extent of Negative Equity in the Irish Housing Market. ESRI Research Notes 2014/2/1

Duffy, David (2014) Updated Estimates on the Extent of Negative Equity in the Irish Housing Market. ESRI Research Notes 2014/2/1. UNSPECIFIED.

PDF - Published Version Download (196Kb)

Abstract

Negative equity occurs when the price of a property falls below the value of the outstanding mortgage secured on that property. Given the scale of the housing market downturn it is not surprising that previous research has shown the presence of widespread negative equity in Ireland. Duffy (2010) provided an estimate using aggregate data, based on data available to Autumn 2009. At that time house prices were down 27 per cent from their peak. However, we now know that the decline in house prices lasted until the latter half of 2013 and that house prices fell much further. The CSO Residential Property Price Index shows a peak to trough decline in house prices nationally of over 50 per cent, with prices in Dublin falling by over 57 per cent peak to trough. More recently the Index shows some recovery in house prices during 2013. This has, to date, been primarily driven by price movements in Dublin where prices in December 2013 were over 15 per cent higher than a year previously. In contrast, house prices outside Dublin were moderately lower than they had been in December 2012.

Actions (login required)