‘Opaque’ process of buying and selling homes having negative impact on housing supply
Ottoline Spearman
Ireland’s opaque process of buying and selling homes is contributing to poor levels of housing liquidity, according to a report published on Monday.
The report from property portal MyHome, in association with Bank of Ireland, states that a lack of transparency in bidding, along with an emerging divergence between the asking price and final sold price of properties, are among a range of inter-related issues that have led to the liquidity in the housing market falling behind European countries, the UK and US.
It recommends that estate agents continue to adopt and encourage the use of emerging online transparent bidding platforms, as they can provide greater trust and confidence in the housing market.
Joanne Geary, Managing Director of MyHome, said: “A fully transparent bidding process may improve market functionality and, by extension, help to improve housing liquidity. At present, close to half of residential transactions are visible on platforms that feature online bidding or auctions, including MyHome Offers.
“A key advantage of these platforms is that they provide buyers with transparent information about the bidding history of the properties they are interested in, as well as giving the buyer the digital means to view and place an offer at any time.”
According to the report, there were 61,000 residential property market transactions in Ireland in 2024, equivalent to 2.8 per cent of the housing stock. This turnover rate was well below the UK’s turnover rate of 3.6 per cent, itself depressed by rising interest rates and well down from the 4.2 per cent rate it experienced on average between 2013-2022.
Liquidity in the Irish housing market has lagged behind the UK in every year since the global financial crisis, seeing turnover rates even below those of Northern Ireland, which saw a similar house price collapse to Ireland.
This issue is most pronounced among existing homeowners with mortgage debt looking to move home. Just 9,000 mortgages were drawn down by movers in 2024; this represents just 0.4 per cent of housing stock, which is less than half the UK rate of 0.9 per cent.
Conall MacCoille, Chief Economist with Bank of Ireland and the author of the report, said: “That Irish housing supply has failed to keep pace with buoyant demand is well understood.
“Perhaps less appreciated is that the process of buying and selling existing homes is also impeded by an opaque bidding process and the emerging discrepancy between asking prices and final sold prices.
“The introduction of the Property Price Register has brought welcome transparency to the Irish housing market but there is scope to go further. Estate agents are already required to disclose legitimate bids to the PRSA.
Allowing prospective buyers to see these bids, via new technology platforms, can only help the functioning of the Irish housing market.”
The reports cites pricing, lack of transparency and lengthy processes as the main reasons for poor liquidity. At present, approximately one-in-seven of all transactions are being settled for at least 20 per cent over the asking price. This emerging divergence between asking prices and final sold prices is contributing to an unclear picture for both would-be buyers and vendors.
Further, a recent CCPC survey showed that just 16 per cent of buyers felt the housing market is transparent, and the Commission said that homebuyers were at risk of inadequate information during the pre-sale agreed period and conveyancing stage. Opaque bidding processes may also be a problem.
‘Chains’ of transactions are also not generally a feature of the Irish property market, as they are in the UK. As a result, many would-be vendors are put off selling their home, for fear of failing to secure another.
