One in Ten Sellers Reduce Asking Price

17th October 2007, Daft.ie, Ireland's largest property website, today released the latest Daft House Price Report. The report shows that since the start of the year one out of every ten sellers reduced the asking price of their home to force a quicker sale. While some of these price drops have been significant, the vast majority of price drops have been less than 5% of the initial asking price.

At the same time, properties are taking longer to sell. One out of every five properties listed on Daft.ie in January 2007 is still for sale nine months later, leading to an all-time-high in the supply of houses for sale (just under 100,000 units). The national average price of a house now stands at €368,000 down by 2% in the last three months.

Regional Trends
In Dublin, prices remained fairly static over the last quarter, except in the city centre where prices rose by 6.2%. Cork city has also seen prices rises of 2.9% while Limerick (-1.3%) and Galway (-2.3%) have seen modest decreases, with Waterford remaining static. Outside Ireland's main cities, asking prices have been either static or showing modest decreases.

Commenting on the Report, Ronan Lyons, Economist at Daft.ie, said "The findings in the latest Daft report are interesting because it comes at a time when the market is usually launching into a period of activity. Last year in quarter three asking prices rose almost 4%. In this quarter, they have fallen by 2%."

"While this has lead to a drop in confidence amongst sellers, the vast majority of sellers are reluctant to reduce their asking price even though anecdotal evidence shows that dropping your asking price by as little as 1 to 5% will lead to a faster sale. Perhaps given the strength of the rental market and continuing strong immigration vendors are content to wait for the market to pick up."

Dr. Ronnie O'Toole, chief economist with National Irish Bank suggests that the latest Daft.ie figures show that the housing market is currently marking time and looks forward to 2008. "In trying to predict housing demand into 2008 and beyond, the joker in the pack is immigration. Even without any immigration, we will probably need 38,000 homes to be built annually over the next number of years. But a slower housing market will not end migration here. While it is true that construction has been an important source of employment for migrants, it is not as important as some would have you believe. Figures from the latest Census show that 18% of Eastern Europeans in Ireland work on building sites, only double the national average. The other 82% are in a wide array of other jobs. If immigration were to run at levels like those witnessed in 2006, then we may need more than 66,000 homes."

Dr. O'Toole believes that the likely outcome is a gradual fall in migration levels. "House demand will gradually fall off in tandem with slower inwards migration, though will remain at levels that look high relative to historical experience. Rents are likely to remain strong, and the shift towards buy-to-let from owner occupancy will continue. Importantly, the fact that this will happen gradually will allow the wider construction industry to accurately predict the future demand for housing, and to adjust their plans accordingly. There will be no unexpected collapse in migration that may have tipped house prices over the edge."

A full copy of the report is available online at www.daft.ie/report and includes a full commentary from Dr. Ronnie O'Toole, Chief Economist with National Irish Bank.

For further information please contact:
Odhran Ginnity, Daft.ie - media at daft.ie.

Notes to the Editor
Daft is Ireland's largest property website with the largest selection of residential property for sale, commercial property and residential lettings in Ireland. In March 2007, a report by the Audit Bureau of Circulation (ABC) confirmed that Daft.ie was Ireland's busiest website with requests for over 53.8 million pages of information received (Page Impressions) in March 2007, ahead of Ireland's next busiest websites including: RTE.ie (43.4m, May '07), Carzone.ie (34.9m, January '07), MyHome.ie (26.4m, September '06) and Eircom.net (23.9m, October '06).

About the Daft.ie House Price Report
The Daft.ie House Price Report, now in its 14th edition, is based on an analysis of the full database of properties posted for advertisement on Daft.ie, up to 30 September 2007. The monthly average for properties posted is just over 15,000. This figure represents a large percentage of the available properties for sale in the country and therefore gives a very accurate and timely reflection of what is actually happening in the Irish property market. Figures are calculated from econometric regressions using standard methods.