IRELAND - Irish property returns continued to slide through 2002, according to the first full results for last year from Investment Property Databank (IPD).
IPD says that while market factors were chiefly to blame, capital values were further depressed in the fourth quarter by a 3% increase in stamp duty in Ireland.
Overall, capital values fell by 3.0% last year and all property total returns declined to 2.2%, against 8.2% in 2001 and an average of 12.5% per year over the last three years.
In a generally gloomy picture, retail continued to be the best performer while offices suffered the largest setback.
As in 2001, the drop in returns reflected a combination of both a slowdown in rental value growth and an unfavourable rise in yields. Rental value growth, which slowed to 1.9%, was below the rate of inflation for the first time since 1994.
The returns on property in Ireland compare to those of the bond market (10.4% in 2002, outperforming property for the first time since 1995) and equity returns, which came out at –27.2% for the year.