Last year we spoke of the many investment opportunities in rural areas due to the huge influx of people working from home due to pandemic restrictions. Well, that trend certainly hasn't ended with prices in some areas such as Cavan, Mayo and Galway up as much as 8.7% in the first 3 months of this year alone according to a recent housing survey conducted by the REA (Real Estate Alliance).
A quick comparison of prices from 12 months ago to today, shows huge increases. For example, we spoke about the beautiful town of Mullagh in Co. Cavan, where a 3-Bed semi-detached property at the time was on the market for €110,000. Similar properties in the same area are now asking for €185,000. There are currently zero properties for rent in the area (as per daft.ie at time of writing) so this would have been a fantastic investment with rental prices for similar properties in the past landing between €850-€950 per month. With demand the way it is, a newly refurbished property with modern appliances and an efficient energy rating could warrant a significant increase in rent.
The biggest rise in the first quarter of this year has been Co. Galway with an average rise of 8.7% when looking at 3 Bed Semi-detached properties. The average price now sits at €193,500. Given that last year we gave the example of a 4-Bed Semi-Detached property on the market for €125,000 in Tuam, Co. Galway, this is a huge increase and represented a wonderful investment opportunity at the time.
So when is it all going to end? When will house prices plateau or worse, begin to fall? Having dealt with the uncertainty of the last two years we now have other issues on the horizon. It isn’t clear as of yet just how bad this current inflationary period will be. Property markets will be affected if materials become more expensive or harder to source due to current lockdowns happening in China and the conflict in Ukraine.
But prices cannot rise indefinitely as the average buyer will just have no chance of entering the market. The question for investors is just how much longer is left to reap the profits. Unfortunately, as we have all learned over the past couple of years, you never know for sure what is around the corner. Right now things are good for property investment. That’s all we can be sure of.
