The unprecedented times of COVID-19 have devastated the world economy, impacting every sector, from energy to manufacturing. The sudden fall of economy has created a sense of resentment in people to invest openly. Even the real-estate in many countries have hit hard, with view of people emptying their rental property due to high rent or cancelling the deal of homes they wanted to buy.
With swell of COVID-19, the construction activities were greatly reduced, which has impacted the property market negatively.
Impact of COVID-19 on Ireland’s Housing Sector
Taking Ireland into consideration, the annual house price inflation has risen over 1%.
The number of properties that were sold during April and May in Ireland plummeted since during this time Ireland was in full-lockdown. There were around 2550 homes sold in the month of May, which makes it 50% of what was sold in May, 2019. The steepest decline was seen in Dublin, where the number of sales fell more than half of the previous year. The overall transaction of residential property fell to €535 million from €1 billion.
Though many analysts envisaged the prices of houses will drop down but a report by Central Statistics Office (CSO) indicates the rise of housing prices since June, 2020, in Ireland. What this means is, house prices haven’t plummeted but housing supply has.
Challenges ahead for Ireland’s Real-Estate
As Ireland step into post-pandemic recovery, the housing industry is going to have a path full of challenges.
Even before COVID-19, there was a shortage of houses. Government planned to build 20,000 houses in 2020 but due to pandemic construction came to a standstill and the problem of houses persisted.
The shortage of houses will lead to rise in house prices, which will create another challenge of affordability.
Ireland’s housing prices are second-most expensive in the world after Switzerland. Inflation is going to make it even harder for citizens to buy house of their dreams.
As some relief measures, government has provided a stimulus package, under which Help To Buy incentive for first time buyers has been extended up to 31st December, 2020.
It’s completely unpredictable when the pandemic will end but government’s efforts in the right direction can give impetus to housing sector, to get back on its feet. The recovery from the impact of COVID-19 will be slow but the surveys conducted in the past few months suggest that the market will get back on track by 2021.