2022 Inishowen Property Prices – ‘Chronic Shortage of Supply’ driving prices up
A LEADING Inishowen estate agent says a “chronic shortage of supply” – due to the ongoing problems with mica and a dearth of new-builds – is driving prices up. Brendan McGee, Managing Director of Franklins, says the market is still starved of enough properties to meet the demand, but he’s hopeful that 2023 will finally see developers back on site.
Buncrana man Brendan explains how a tiny number of new-builds for sale locally are often attracting huge interest and large sums, something which gives him hope for the near future. “Some towns and villages in the peninsula are witnessing some new-builds, but many of these are self-builds for owner occupation, so they are not likely to be available for sale.”
“However sale are attracting high volumes of interest and are selling at levels far beyond what the older stock is selling for.”
“It is these sales that provide Franklins with the hope that we will see developers back on site in 2023. We need more private houses and local developers have the land and planning permission to deliver what is so badly-needed,” he added.
BRENDAN SAYS much has been made of the fact that next to no new private houses have been built for sale in Inishowen since 2008 – that’s effectively no new houses now for fifteen years. He explains how the problem lies in straightforward economics. “Up until 2022 the figures simply didn’t add up [to build]. Many will know from the reporting of mica that the cost to rebuild (new property) today is in the region of €160 per square foot.” “So if we take a three bedroom semi-detached house at 1150-square foot; this would mean it costs €184,000 to build. Add in the cost of the site, planning fees, development charges, professional fees, VAT at 13.5 per cent, and the numbers simply didn’t stack up.” “Only now in 2023, with increased values, are we seeing some hope for developers to go back on-site.”
He warns that the banks must play their part to get things moving too however. “Anecdotal evidence tells us that the high street banks in Ireland remain nervous about lending for housing development in rural counties.” “Developers tell me regularly that the lenders simply don’t want to know when approached for finance for multiple development sites.” Inevitably, Brendan says mica remains the biggest problem across Inishowen. “Whilst it seems the issue of mica-affected properties is now extending beyond Donegal, it is our peninsula that appears to be the worst hit.” “Individuals and families who, for various reasons need to sell up, are unable to do so, which means less and less properties are coming to the market. Less stock means lower sales volume and increased pressure on those who are living in inadequate housing to meet their needs.”