Homes market revival as Irish cash in abroad
THE sale of overseas property investments by Irish owners is helping to fuel a revival of the domestic market.
Investors who bought property overseas during the Celtic Tiger have begun flocking back.
One foreign property adviser has reported a large increase in investment, especially in Dublin.
According to Extrasales, there has been a recent trend of people selling overseas property assets to free up cash to buy in the capital.
It comes as figures from the Central Statistics Office show that Dublin property prices jumped 8pc in the past year.
The CSO figures also show that there was a 2.3pc rise in house and apartment prices across the state in July, compared with prices a year ago.
There are now fears that a shortage of family-type homes in Dublin, particularly south of the city, is leading to a bubble.
However, the price of residential properties in the rest of Ireland fell marginally in July, compared with an increase in July last year.
Prices were 1.5pc lower than in July 2012.
According to Extrasales, more and more Irish people are selling their foreign properties, particularly in Spain, Turkey and Bulgaria.
The international property company has a conducted a survey among its Irish clients.
It found that almost 60pc have sold an overseas property in the past six months to secure apartments in Dublin.
A significant drop in property prices in the capital since the height of the boom and a growing rental market have been credited with the increase in property investment.
One investor who decided to get out of foreign property to buy in Ireland was Martin Creighton (43), of Clondalkin.
The father-of-one said he and his wife wanted to invest for the future of their son, now seven, but at the time Ireland wasn't an option.
"We bought an apartment in Bulgaria in Golden Dreams, on Sunny Beach, near Burgas, in 2006.
"We looked at Ireland at the time, but it was far too expensive; everyone thought it was never going to end," he said.
At the time, the family paid €65,000 for a two-bed apartment but they have sold it for €50,000 to buy a similar-size flat in Charlotte Quay.
"You have to cut your losses," Mr Creighton said.
He is in negotiations for the apartment and said it has been offered at a fraction of what it would have cost during the boom, which Mr Creighton estimated was around €500,000.
A number of Russian and Chinese investors have also approached Extrasales with a view to investing in Dublin.
"There's never really been a better time to invest in Dublin. City centre apartments that cost €450,000 in the boom are selling for as little as €150,000," said MD Colin Horan.
"Those who can afford to purchase these properties are doing so with a long-term view to renting them," he added.
However Extrasales also reported that 22pc of people they surveyed said they sold foreign property to clear or reduce bank debts.
It is estimated that there are more than 400,000 Irish-owned properties in Spain, Bulgaria and Turkey alone.
Economists have recently warned of a decoupling of the Irish property market, whereby prices in Dublin are increasing due to insufficient supply and increased demand.
DAN WHITE, PAGE 15