Cost of living crisis hitting prospective home buyers
Half of prospective home buyers say the rise in the cost of living has affected their ability to buy a property, according to new research by property website MyHome.ie.
The survey of almost 3,000 people carried out in August shows that inflation is having a significant effect on the homebuying, rental and home renovation markets.
63% of prospective renters say the rise in cost of living has affected their ability to rent a property, while 45% say it has affected their ability to renovate or do other building works to their home.
The findings show that 63% of prospective homebuyers and 75% of renters have had to look beyond their top location choice because of price concerns.
“The rise in the cost of living is having a significantly negative impact on consumer sentiment, yet we know that demand is still very robust despite these financial pressures,” said Joanne Geary, Managing Director of MyHome.ie.
“On MyHome.ie in July we saw a surge in brochure views up by over 40% on the previous year – we can see from our metrics that buyer demand is remaining remarkably strong,” she added.
It appears that the impact of property price inflation and the rising cost of living may have tempered people’s expectations on price rises in the next year.
Just three in ten of those surveyed expect property prices to go up over the next 12 months, compared with six in ten in April of this year.
“Even though interest rates have recently risen, they are still relatively low and it remains to be seen how much of these increases will be passed on by the banks,” Ms Geary said.
“Given employment levels are at an all-time high, the demand dynamic in the market remains very buoyant in spite of cost of living increases,” she added.
Meanwhile, the research suggests that sentiment is particularly negative among renters.
“Renters are under huge pressure and, anecdotally, we know that many of those who are in a position to leave the rental market and buy are pressing ahead perhaps sooner than they otherwise would have, given the lack of value, uncertainty and choice in the rental market at present,” Ms Geary said.
“In many cases, it simply could be cheaper to buy than rent if the stock was available to buy.”