Dublin and Cork-based estate agency Lisney has produced a raft of reports on the state of various Irish property markets in the third quarter of 2012. The six reports paint a mixed picture of the health of various markets with claims that residential prices in Dublin are up 4.5% in the quarter which is higher than competing surveys from Sherry FitzGerald, MyHome and DAFT, though apartments continue to decline. Residential rents also are up – in Dublin by more than the 2% reported by the CSO nationally. Concerns are raised about reduced residential supply.
We should get the Jones Lang LaSalle commercial index for Q3,2012 next week and the betting on here is that there will be a small decline of 2-4% in the quarter, but Lisney does report on commercial rents and says that overall, across all commercial property sub-sectors, rents declined by 2.4% in Q3,2012, though that masks a claimed stabilisation in the office market and larger declines in retail and industrial. Since the peak in the second half of 2007, commercial rents have declined by 51.9% according to Lisney.
Lisney is upbeat on the investment market and reports transactions totalling €296m in the first three quarters of 2012, which Lisney says is 80% up on 2011. Cast your mind back to Budget 2012 when the stamp duty on commercial property transactions was reduced from 6% to 2% and the 4% reduction was estimated to cost the Exchequer €64m in 2012 – see above – which implied a market of €1,500m. Whilst investment is part of the market overall, it looks as if we will be lucky to have €500m of commercial transactions in 2012. Given that reform of the thorny Upward Only Rent Review terms in legacy leases was abandoned and extra tax incentives were offered for the purchase and holding of commercial property, the actual transaction levels are deeply disappointing.
The six Lisney reports are here: