First-time buyers facing house prices €88k higher than five years ago, says report
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House prices for first-time buyers rose by €88,000 on average over the past five years, new figures show, with the average cost of a new home for new entrants to the housing market now €360,000.
The latest mortgage market profile report issued by the Banking and Payments Federation of Ireland (BPFI) shows that average prices for home-movers increased to an even greater extent over the same time period, up €109,000 to €470,000.
The first-time buyer information comes following an election where great emphasis was placed on how the cohort should be aided going forward.
Fianna Fail had argued that first-time buyer schemes like Help To Buy and First Home should be expanded, while Sinn Féin had proposed that those policies should be abolished outright.
The new report details that the greatest increase in first-time buyer prices was seen in counties Wicklow, Galway, and Limerick, together with the midlands region, which saw hikes of €100,000 between 2019 and the first half of 2024.
Further, average first-time buyer and home-mover costs are now at their highest levels since the data series was first collated in 2003, when those values were €289,000 and €330,000 respectively.
Chief executive of the BPFI, Brian Hayes, noted that the latest report shows that the majority of first-time buyer mortgages are now being approved for high-value new builds, as opposed to lower value second-hand properties.
Over the five-year period in question the share of first-time buyer mortgages secured on new properties valued at more than €300,000 in Wicklow, Galway, and Limerick increased by about 20%.
In the midlands, nearly 40% of first-time mortgages on new properties in 2024 were valued at greater than €300,000, compared to just under 6% in 2019.
Despite these rising prices, the actual number of mortgages held around the country are well below the peak levels seen in Ireland prior to the Celtic Tiger financial crash post-2008.
“It’s clear that the mortgage market is continuing to evolve toward higher-value properties, as homebuyers prioritise energy-efficient and more modern homes,” Mr Hayes said.
“We are also seeing the continuation of the trend identified in previous reports where Dublin-based FTBs are increasingly looking to locations outside of the capital," he added.
Cork represented the second largest regional market in the report, behind Dublin, with 11.6% of the entire volume of home mortgages in June 2024. The county also had the highest level of first-time buyer mortgages on new properties in the first half of 2024, with 17.2% of such transactions.
Separately, just under a quarter of all first-time buyer purchases of second-hand properties in 2024 were in the Dublin market, showing the appetite for and supply of older homes hitting the market in the capital.
Meanwhile, the south east of the country is now the third largest regional mortgage market in the country, replacing Kildare, with just under 9% of all mortgages.
In terms of household income for first-time buyers, the west of the country saw the lowest combined salary for those purchasers at €63,000, with the median value of the homes being bought recorded at €180,000, the lowest across all regions.
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