Ireland has recently seen an increase in the number of investors buying holiday homes in some of the country’s most picturesque areas. With stars like Jeremy Irons and Daniel Day-Lewis popping up in the quaint towns of West Cork, prices in many of these areas are sky high. Kerry and West Cork in particular, and the south coast in general, known as the Irish Riviera, attract a steady stream of Brits and Americans. Most UK buyers are investing in a property to use as a holiday home with the intention of retiring there in the future.
Ireland’s south coast tends to have a more temperate climate than the rest of Ireland, experiencing warm summers and milder winters brought by the Gulf Stream that passes along its coast. The climate, coupled with the stunning scenery and strong sense of heritage and culture, has made Cork an attractive location not only for Brits looking for a rural idyll to retire in, but also for the French and Dutch who have felt attracted to the county for a long time.
The Irish too, taking advantage of improved roads, domestic flights offered by Aer Aran and generous tax incentives, are beginning to look for investments in holiday homes closer to home. With prices as low as £110,000 for a two-bedroom villa on the Dingle Peninsula, investing in a holiday home in Ireland doesn’t have to break the bank. In general, chalet-style homes will be cheaper to purchase than stand-alone properties on their own land.
Most people want to buy a traditional style house with views of the sea or unspoiled countryside. A typical three-bedroom property with sea views could cost more than €480,000, while a property with spectacular countryside views could be priced at more than €280,000. The difficulty and one of the contributing factors to high property prices in Ireland’s most picturesque locations is the scarcity of properties coming onto the market. It seems that when people shop in the most picturesque places in Ireland, they don’t want to move!
Since many of the people who buy holiday homes in Ireland have roots in the country, they tend not to get too involved in renting the property. For those looking to invest in a holiday home to rent out when not in use, the rental potential of properties located in areas such as West Cork, Kerry, Connemara or picturesque port towns such as Killibegs is good. A four-bedroom house with good sea views could expect to earn EUR 1,000 per week in the summer season.
Very often, buyers find that vacation homes are too small and see expanding the property or building a new home as the best option. It is worth taking into account the difficulties that can be found when doing this route. Strict planning regulations make it nearly impossible for foreign investors, or indeed Irish citizens from outside the county, to build property on purchased land. Planning regulations favor locals who build new homes in the area. It may also be more difficult for foreign buyers to obtain planning
permission to significantly alter or renovate an existing property, although once a property is owned it is easier to secure planning.
With demand for second homes holding steady, there are no signs that prices are slowing down. Last year property prices in West Cork increased by 8-9%. The situation is similar for many of the other tourist spots. Rental income aside, anyone who makes a smart investment in some of Ireland’s most desirable scenic spots can expect to see a significant return on investment for years to come.