The rate of house price growth unexpectedly slowed in December – bucking a trend of accelerating house price growth through since early last year.

Commenting on the results Dr. John McCartney, Director of Research at Savills noted that this was more than likely a temporary pause.

“Towards the end of last year there was much speculation about two potential housing policy changes – the possible easing of mortgage lending restrictions and the prospect of a new Help-to-Buy scheme. Anticipation of these measures almost certainly caused some potential buyers to hold off in the belief that they would have more buying power if these policies came to fruition.”

Indeed Property Price Register data show that house sales fell by 23% year-on-year in December.

Ultimately both of the expected policy changes were made – mortgage lending restrictions on first-time-buyers were slightly relaxed and secondly the Government announced a new Help-to-Buy scheme which will give first-time-buyers of new homes a tax rebate of up to €20,000 to put towards the deposit for a new house. In the event the latter was back-dated to cover deals done from mid-July.

McCartney continued;

“With these schemes now active and enabling first time buyers to pay more in the market we expect the house price index to resume its upward trend. However, due to the time lag required to collect data and compute the index, this might not be seen until March or even April.”