The property market has given one of its clearest signs yet that it may be recovering with the news that developers have started to sell new homes off plans for the first time in more than five years.
With a dwindling supply of good quality family homes in major urban areas such as Dublin, many people are turning to new developments to find a place.
The Irish Independent reports today that deposits have been put down in advance of construction for more than 100 new homes worth €23m in five developments in the greater Dublin area.
The average deposit is said to be €5,000 on homes selling for between €200,000 to €400,000.
Estate agents claim that the revival of advance sales is down to a shortage of family-sized properties close to city areas caused, in part, by negative equity which is preventing those who bought during the boom from selling up. This has led to a lack of second hand properties coming on to the market.
In at least one scheme, prospective buyers have been paying deposits for homes that haven’t even received full planning permission, a practice which was unheard of even in the boom years.
At another development, new home prices have started to rise in reaction to demand.
At the Peyton scheme off Stoney Lane in Rathcoole, Co Dublin, Blackchurch Homes has taken 13 deposits since the beginning of the year for €265,000 three-bedroom homes in the final phase, which have yet to obtain planning clearance.
Glenn Burrell, of Finnegan Menton, the agency selling the properties, said the deposit system was the fairest way of ensuring buyers could reserve a home in the last phase. If the scheme doesn’t get permission, they’ll get their money back.
Elsewhere, Coonan Auctioneers says it has sold 55 homes off plan since last year in areas such as Maynooth, Celbridge and Kilcock. Meanwhile, prices for the four-bedroom homes at Castlepark have risen from €380,000 to €400,000.
Savills have also sold 20 family homes off plans at The Grove in Lucan, with three beds priced from around €200,000.