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Estimating Cash Buyers and Transaction Volumes in the Residential Property Sector in Ireland, 2000-2014

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  • Coates, Dermot

    (Central Bank of Ireland)

  • McNeill, Joe

    (Central Bank of Ireland)

  • Williams, Brendan

    (University College Dublin)

Abstract

This article describes data used to address the issue of the volume of transactions and cash-only sales in Ireland’s residential property market over almost two decades. The approach employed here examines the proportion of total residential property sales attributable to cash buyers (or nonmortgage transactions) and provides new insights which allows for a deeper understanding of developments in the market. We find that at the pinnacle of Ireland’s housing boom, there were approximately 150,000 transactions, with cash buyers accounting for 25 per cent of these sales. Since then the volume of transactions fell to a low of 21,000 in 2010 while the share of cash purchases had risen to around 60 per cent in more recent years. The increase in the share of cash buyers reflects the sharp fall in the number of mortgages drawn down while the actual number of cash-buyer transactions is not necessarily atypical of the early years of the last decade. We also find that the turnover of residential property – or total transactions as a proportion of the housing stock – has fallen sharply since the crisis and is currently low, both by historical and by international standards.

Suggested Citation

  • Coates, Dermot & McNeill, Joe & Williams, Brendan, 2016. "Estimating Cash Buyers and Transaction Volumes in the Residential Property Sector in Ireland, 2000-2014," Quarterly Bulletin Articles, Central Bank of Ireland, pages 68-81, July.
    • Handle: RePEc:cbi:qtbart:y:2016:m:07:p:68-81
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    File URL: https://centralbank.ie/docs/default-source/publications/quarterly-bulletins/qb-archive/2016/qb3-16/gns-5-1-1-1-quarterly-bulletin-no-3-2016.pdf?sfvrsn=10#page=66
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    Cited by:

    1. Lydon, Reamonn & McCann, Fergal, 2017. "The income distribution and the Irish mortgage market," Economic Letters 05/EL/17, Central Bank of Ireland.
    2. Lozej, Matija & Onorante, Luca & Rannenberg, Ansgar, 2023. "Countercyclical capital regulation in a small open economy DSGE model," Macroeconomic Dynamics, Cambridge University Press, vol. 27(5), pages 1230-1267, July.
    3. McQuinn, Kieran, 2017. "Irish house prices: Déjà vu all over again?," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI).
    4. Youngme Seo & Cynthia Holmes & Mark (Seung Hwan) Lee, 2023. "Examining the Cash-Only Price Discount and the Driving Forces of Cash-Only Transactions in the Housing Market," The Journal of Real Estate Finance and Economics, Springer, vol. 67(3), pages 480-516, October.

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