With the change in the property market, the first-time buyer now has choice and clout when hunting for a home.

The second-hand property market and first-time buyer s may not have mixed much at height of the property boom, but all that has changed in recent months.

Over the past five years the copious amount of new properties coming onto the market offered first-time buyers considerable choice, from apartments to duplexes and townhouse, in a range of locations.

The second-hand market didn’t enter the equation for most first-time buyers, as prices were higher than in new schemes and they would have had to pay stamp duty. That has now changed dramatically.

A price drop of between 10 and 20 per cent means the secondhand market now offers first-time buyers better value than those newly built schemes where developers are still resisting price cuts.

The average price paid for a house nationally in December 2007 was €287,887, according to the latest Permanent TSB/ESRI house price index. This compares to a price of €310,632 recorded in December 2006.

The index showed that the national average cost of houses for the second-time buyer market declined by 7.9 per cent last year, compared with a decline of 6.5 per cent on the cost of houses for first-time buyer market.

Paul Murgatroyd, economist with Douglas Newman Good, said there has been a significant pick up in first-time buyer activity since Christmas.

‘‘That wouldn’t have been too difficult seeing as activity was nonexistent in the last quarter of 2007, but we are now seeing first-time buyers out viewing properties,” Murgatroyd said.

‘‘Most of these buyers are already loan-approved and have been for several months - many were in the market last summer but they decided to rent until the market steadied. We are now seeing price reductions in play and first-time buyers are semiseriously starting to buy and make bids, albeit under the asking prices.”

The entry level for the secondhand market varies from about €350,000 to €400,000, depending on the type of property and the location. For example, a three-bedroom semi on Raheen Avenue in Fortunestown in Dublin 24 has a price of €340,000, a two-bed terrace in Millmount Terrace in Dundrum, Dublin 14 is on the market with an asking price of €400,000, while a studio in The Westmoreland in Charlotte Quay Dock is on the market for €249,000.

In Harold’s Cross, two-bedroom terraces are on the market with asking prices around the €400,000 mark, while in the Hunter’s Green development in Firhouse, there is a two-bed apartment for €345,000.

Marie Hunt, director of research at CB Richard Ellis said the secondhand market has seen a little recovery but is still slow. ‘‘This means first-time buyers can take advantage of the reduction in asking prices. Houses are sitting on the market because there are so few buyers out there, so those that want to buy are in a better position,’’ Hunt said.

‘‘The fact that stamp duty was taken off the agenda in the last budget means second-hand buyers can now move forward without worrying that they would be the last to pay the tax at a higher level.”

Confidence levels, however, remain low among first-time buyers and they are still nervous of buying a property and falling into negative equity. But the slight movement within the new homes market and the increase in viewing numbers on second-hand properties hints at a slight turnaround.

Murgatroyd said the best value to be gained in the market was in two and three-bed mid-terraces rather than apartments.

‘‘Small starter homes are in demand,” he said. ‘‘First-time buyers can see that the opportunity exists now for them to buy a small three-bed terrace rather than an apartment, whereas they wouldn’t have been able to afford houses in 2006.” He said this was one of the main trends of this year.

Trina Beakey, manager of Savills Hamilton Osborne King’s Phibsboro office, said areas such as Stoneybatter and Phibsboro are seeing a lot of activity in the first-time buyers market.

‘‘A two-up, two-down house in Stoneybatter would have been hitting the €500,000 mark a year or so ago but now they are pr iced at about €440,000 to €460,000,” she said. ‘‘The properties on our books are starting to move, there are a lot of viewings, predominantly from first-time buyers.”

A two-bedroom house on Kirwan Street in Stoneybatter is on the market with an asking price of €320,000 Beakey said first-time buyers are looking for good locations and convenience, and want to be close to the city centre.

‘‘Second-hand homes are on a price par with newly built homes - there is no longer an advantage to buying a new development over a second-hand property so we’re seeing lots of activity from first-time buyers in the market,” she said.

Beakey has noticed that couples who are trading up from apartments to houses are not selling their apartments, but deciding to hold onto them for a couple of years and then sell them.

‘‘First-time buyers are much more in tune with the market now - when they are viewing properties they can tell me exactly what price a property achieved and how much the asking price was of houses in the area,” said Beakey.

In Phibsboro, buyers can get a two-up, two-down redbrick for between €400,000 and €440,000. Beakey said those properties would have been reaching €500,000 last year. A one-bedroom studio in Riverbank Gardens in Glasnevin is on the books of the Phibsboro office for €225,000.

West Dublin has become a prime first-time buyer area in the last couple of years, said Murgatroyd. ‘‘It saw the sharpest price increase in 2006, and above average decreases in asking prices in 2007, so there is good value in the area in the current market,” he said. Declan Cassidy, managing director of Gunne Residential, said there is a little bit more activity in the market since Christmas.

‘‘We’re now witnessing a change in the market, because interest rates have stopped going up and affordability has improved with increased tax relief and the reform of stamp duty,” said Cassidy.

Areas close to the city centre with public transport such as along the Dart and Luas lines are performing better than the outskirts of Dublin city, according to Cassidy. ‘‘Our agents outside Dublin say it’s still quiet but in the capital, we’ve had a better start to the year than anticipated.”

The entry level in Dublin’s northside is about €340,000 to €350,000 for a two-bedroom terraced house in areas such as East Wall and Coolock. In Fairview, the entry level would be about €460,000 for a three-bedroom property and rising to €560,000.

Cassidy said new instructions were down 30 to 35 per cent and there is not a huge stock of property available in the second-hand market: ‘‘As long as the first-time buyers keep viewing and purchasing properties, then there should be movement in the overall market in 2008.”

Clontarf, Booterstown, Blackrock and Dun Laoghaire are all areas that first-time buyers were entirely priced out of in the property boom but the slowdown in the market, stamp duty changes and improved affordability mean that houses at the very lower end in these areas are now somewhat achievable.

‘‘First-time buyers could not have afforded any property in Clontarf in the recent past, but now a small mid-terrace three-bedroom property can be bought for about €620,000 - it was unheard of to get a place in Clontarf for that price a couple of years ago,” said Cassidy.

In south Dublin, prices have come back sharply and first-time buyers can now buy two-bed apartments in the Dun Laoghaire and Monkstown areas for about €500,000. One-bed properties are priced at around €350,000 and €400,000 mark depending on location.

In Dun Laoghaire, a two-up, two-down property on Findlater Street can be bought for €480,000.These artisan dwellings on roads such as Convent Road have all fallen in price from about €530,000 last year.

‘‘There is a shortage now of new build first-time buyer properties because the developers have halted all their schemes, so first-time purchasers are looking towards the second-hand market,” said Ronan O’Hara of Savills Hamilton Osborne King’s Dun Laoghaire branch.

‘‘Second-hand properties offer even better value since the abolition of stamp duty for first-time buyers and new build properties no longer have that advantage over our market. And all the prices of existing stock have been reduced in the last few months -most vendors have reduced their prices and the take-up in sales is improving.”

The Sunday Business Post , By Michelle Devane, 17 February 2008