Two leading property firms have agreed that the Irish property market has yet to bottom out.

House prices have plunged almost 40% since the peak of the boom, two property reports revealed today (Wednesday).

The daft.ie survey, which records a large number of asking prices nationwide, put the average asking price down to just below 220,000 euro.

But its rival MyHome.ie, which is heavily weighted in favour of the Dublin market, said it recorded an average fall of nearly 35% to 271,000 euro nationally and to 314,000 euro in the capital.

However both firms warned the market was yet to bottom out as consumer sentiment remains fragile in the new year.

Ronan Lyons, economist with Daft.ie, claimed parts of Dublin have seen price falls of up to 50% since 2007, with some counties seeing just a 30% drop.

“On the supply side, the number of properties for sale remains very high, at close to 60,000, while on the demand side, a range of factors continue to weigh on prospective buyers, including tight credit and expectations of higher taxes and interest rates in coming years,” said Mr Lyons.

“It is the cities and in particular Dublin that are most likely to stabilise first, and it remains to be seen if this happens in 2011.”

The Daft.ie house price report review for 2010 showed asking prices for residential property around the country fell by almost 14% in the year, on top of a 20% drop in 2009.

Meanwhile, MyHome.ie said prices fell 13.1% nationally and 15.2% in Dublin during the year, with the total decline from a peak in late 2006 down 34.6% nationally and 41.2% in Dublin.

Annette Hughes, from DKM Economic Consultants, who compiled the report, said it was clear consumer sentiment was fragile as accessing credit remained difficult for potential house buyers.

“Although prices are back to 2002 levels it is clear we have not yet reached the bottom of the market,” said Ms Hughes.

“Other issues which will continue to adversely impact the market include the amount of unsold and vacant housing stock and the precarious financial position of some households following the December budget combined with the need to repay debt.”

However Ms Hughes said with affordability now back to mid 1990 levels, some people who were priced out of the market during the boom years may be enticed back into the market during 2011.

“There is undoubtedly an overhang of potential buyers waiting to enter the market when conditions improve and confidence is restored,” she added.

“The arguments supporting house purchases as a long term investment decision may once again win out, particularly in good locations.”

House prices have fallen a third since the peak, two property reports have revealed.

The daft.ie survey, which records a large number of asking prices right across the country, put the average down 37% to 195,000 euro.

But its rival MyHome.ie, which is heavily weighted in favour of the Dublin market, put the average down 32.4% to 280,000 euro.

Both however agreed that the crash has not bottomed out.

Ronan Lyons, economist with Daft.ie, said a lack of confidence and finance were pushing prices down.

“My judgment on why house prices are falling has not changed,” he said.

“So much property available on the supply side, and on the demand side they don’t have the confidence and if they do they don’t have the finance.”

“Because of that it is unlikely we will see a recovery in house prices any time soon.”

Jean Goggin, from DKM Economic Consultants who helped compile the MyHome report, said prices will only stop falling once the unemployment crisis eases and the economy turns around.

She said prices fell 14.5% last year and 13% over the last nine months.

“While this suggests some improvement in property market conditions it is clear that we have not yet reached the bottom of the market,” she said.

“However 2011 is likely to bring some improvement in the general economic climate which should boost consumer confidence and provide more certainty to households regarding employment and incomes.

“We could then see a modest improvement in some segments of the market.”

Daft.ie said according to its website activity it was taking 8.4 months to sell a home, down from 9.1 months since the start of the year.

MyHome.ie said the average asking price for a home has fallen 11,000 euro in the last three months, down from 291,000 euro. The average house price was 323,000 euro a year ago.

Angela Keegan, MyHome.ie managing director, said prices were falling at a lower rate now than in the same period last year.

“We know there are buyers out there, a lot of them with mortgage approval, but until consumer sentiment improves they will continue to stay on the sidelines,” Ms Keegan said.

“For now all eyes will be on the budget. The good news for anyone contemplating buying a home is that properties have never been as affordable.”

Daft.ie said asking prices in Dublin fell 3.3% in the last three months, 1.5% in Cork and Waterford while Galway and Limerick were largely static.

Outside the main cities, asking prices fell by an average of 4.3%, Daft.ie said.

MyHome.ie reported asking prices in Dublin down by 4.3% – a 16% fall in the last year and down 39% since the Spring 2006 peak. Average asking prices in the capital now stand at 325,000 euro.

In Cork average prices fell by 3.6% to 265,000 euro; Limerick city recorded a drop of 3.4% compared to 7.3% in the last quarter; and Galway, which has seen the biggest falls of any of the cities, saw its average down to 255,000 euro after a 3.7% fall.

The property survey found new home asking prices down by 1.9% compared to 4.3% for second hand homes. MyHome.ie said in the two reports from the first six months of the year new homes fell by substantially more than second hand homes.

New figures have revealed that house prices have fallen to their lowest levels since 2002.

The latest review from the Permanent TSB/ESRI House Price Index shows the average cost of a home is now 201,364 euro – down 35% since the peak four years ago.

But with the pace of decline slowing to 1.7% in recent months, experts said prices could be starting to level off.

Asking prices for Dublin homes decreased more quickly than the rest of the country between April and June, falling by 3.5%.

A house in the capital will now set buyers back 242,000 euro – almost 9,000 euro less than the previous three months.

The average price for a house outside Dublin over the past three months was 181,820 euro, compared with 183,309 euro in the first quarter of the year.

House prices nationally dropped by 6.4% in the first half of 2010.

Permanent TSB general manager Niall O’ Grady said the 1.7% decrease between April and June was the lowest recorded quarterly fall in almost two years.

“This may indicate that prices are starting to find a more sustainable level after almost three-and-a-half years of decline,” he added.

The house price index is based on the agreed sale price and is calculated using data from mortgage drawdowns.

There has been a three-fold increase in the number of 'sale agreed' residential second-hand properties in Ireland in Janaury 2010 compared to the same period last year.

A report by the prominent Irish real-estate website myhome.ie found that there had been a threefold increase in the number of ‘sale agreed’ second-hand residential properties in January 2010, compared with the same month last year.

At the same time, the primary barometer of Irish real estate prices – the Permanent TSB/ESRI house price index – will no longer be published monthly because of the dramatic fall-off in mortgage transactions.

Permanent TSB said that the volume of mortgage transactions had declined so significantly in recent months that an accurate snapshot of trends could not be obtained during the average monthly period. Permanent TSB said its property price survey will now be published on a quarterly basis, with the first quarter figures to be published in April.

These two developments appear to directly contradict each other.

On real estate blog sites, myhome.ie’s optimism was ridiculed.

“Myhome call the bottom … again”, one blogger scoffed.

More objective commentators are suggesting that there is significantly more trouble ahead for the Irish housing market and, on the face of it, myhome.ie’s efforts to foster some optimism appear at best premature or, at worst, disingenuous.

The latest statistics are sobering.

Property prices tumbled by 18.5 per cent last year compared to a fall of 9.1 per cent in 2008. The rate at which houses lost their value quickened as 2009 progressed.

In the fourth quarter of the year, a national price fall of 8.5 per cent was recorded, more than double the rate of decline in any quarter since the market turned. So the downturn, according to the statistics, is accelerating.

One remarkable statistic to emerge in the past week was that a package of development land in Athlone, valued at €31m at the peak of the boom, is now worth just €600,000.

According to the respected economist and commentator David McWilliams, this statistic “has truly terrifying implications for all of us, because it means NAMA will bankrupt us.”

NAMA, the National Assets Management Agency, is the name of the Government’s clearing house for bad loans tied to property developments.

The anecdote about the development land in Athlone is an indicator of the problems facing NAMA, the Government and the taxpayers of Ireland. What value do you put on assets?

Credible commentators believe that with 300,000 empty properties around the country – and with unemployment, 
interest rates and mortgage stress on the rise – the value of Irish property can only fall further.

The risk of mass home loan defaults would be a further disaster for the Irish economy and the Government has moved to extend the period that lenders must wait before seeking repossession from loan defaulters.

They can see what’s coming.

Ireland’s real estate problems will continue until the supply and demand equation levels out. There is a massive oversupply of housing and 
demand is weak. Prices will continue to fall in the short term.

There is an inherent warning here for Australia where we seem to be on the cusp of another property boom. Houses in Sydney and Melbourne are among the least affordable in the world.

This is fuelled in part by high levels of skilled immigration, bringing high earners into the country who want to live close to the CBD.

On the flip side, supply is limited, pushing prices upwards.

It might be wise for house buyers here to reflect on Ireland’s growing problems before they borrow hundreds of thousands of dollars.

In the meantime, the Irish malaise deepens daily and there seems to be no end in sight.