Sherry FitzGerald 2021 market review

The Blake.

The Blake.

More than a year on from the beginning of the pandemic, the fallout from it continues to bear significantly on the property market. Prior to the onset of Covid-19, lack of supply was the predominant issue facing the residential property market both in Galway and nationally, but this situation has been greatly exacerbated by the necessary national lockdowns. The lockdown at the start of 2021 had a twofold impact on supply. It necessitated the closure of most residential construction sites for several months, slowing new homes construction, while also inhibiting potential vendors from listing their property for sale, diminishing second-hand supply.

As a result, there were under 1,000 second-hand properties for sale in July 2021 in Co Galway, 23 per cent fewer than there had been in July 2019. This severe dearth in supply led to competitive bidding in many instances and ultimately to significant price inflation. According to the Sherry FitzGerald House Price Index, second-hand house prices in the west region rose around six per cent over the first nine months of 2021.

Sherry FitzGerald had many sales in Galway city and county across all price categories with properties regularly exceeding value expectations. Some notable sales include Lough Rusheen House, which is the third highest value sale nationally outside Dublin in 2021, selling for €3.06m. Another superb detached house at Scath na Mara, Barna, sold for €1.75m. Prime city locations such as Salthill, The Claddagh, Kingston, and Taylor's Hill continued to experience huge demand again, with properties generally selling in excess of asking prices. Suburban locations east and west of the city such as Roscam, Renmore, Knocknacarra, and Rahoon saw substantial competition for three and four bedroom semidetached homes, with properties selling within four weeks of listing.

Coinciding with this acute shortage of properties, demand remained robust with sales volumes in line with pre-pandemic levels, despite fewer properties available for sale. Demand was strong locally but also from further afield, with many people looking to return to Galway from elsewhere in the country and even from abroad. This again put an upward pressure on prices.

The pandemic has also seen a reconfiguration in what buyers are seeking in a property. Facilitated by greater working from home options, buyers are more willing to purchase further away from their place of work than they have been in the past. Buyers, particularly those with families, are willing to undertake longer commutes on fewer days, in return for greater space, closer proximity to natural amenities, and an overall improved lifestyle, all qualities that Galway offers in abundance.

Due to the lockdowns imposed on the private house builders for the first three months of 2021 the supply of private new homes was also curtailed. This resulted in strong sale levels for the limited supply of new homes available to be purchased. We assisted Burkeway Homes sell all their new homes and apartments at Fanan and The Blake at Letteragh Road, Kenny Developments continued with the successful sales of their luxury detached homes at Beal Taoide, Coast Road, Oranmore, and we also had notable sales of a new development of semidetached houses and apartments at Coill Clocha, Oranmore for BRTW Developments.

The Government announced the new housing strategy Housing for All which, while not perfect, represents progress and will help to deliver more fair and equitable housing. The new Shared Equity Loan Scheme should help thousands of buyers to realise their dream of owning a home. Also, it is welcome news that the Help to Buy scheme has been extended to December 2022.

The rental sector has also been affected by the pandemic. With increased demand and inadequate supply, rental inflation has picked up this year, particularly in regional Ireland including Galway. Double-digit growth has been recorded across many counties.

Looking further into the New Year, unfortunately, supply will likely be the central issue again. Despite several new developments expected to come onstream in 2022, and the notable ramp up in construction activity since sites reopened, it is likely that demand will continue to outstrip supply into the New Year. The good news is we have several significant new developments coming to the market in spring and early summer 2022. The market was active, healthy, and positive in 2021, we had a very busy and successful year. This market can be frustrating for buyers and tenants alike when seeking their home, but perseverance does pay off and we would encourage people keep engaging. Its likely the market will start early in 2022 and will continue to be fluid.

Demand is expected to remain high with working from home set to become a permanent feature of the workplace. As such we expect continued strong interest from buyers looking to return to Galway from both at home and abroad. Similarly, robust demographic and economic factors will also continue to underpin demand.

Finally, as the year now draws to a close, we wish to thank all our clients for their loyal custom throughout 2021. Our key goal is to provide well informed, researched, advice to help our clients make well informed decisions. We wish you all a very happy and peaceful Christmas. If you are considering selling or letting your property in 2022 or require property information, we can be contacted at 091 569123 or [email protected].

 

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