The price of a three-bed semi in Dublin city has hit €500,000 for the first time, the Q2 REA average house price index has revealed.

House prices in the capital rose by 0.3% in the past three months, and are now 14% ahead of their €431,000 Celtic Tiger peak - with demand largely driven by first-time buyers in an otherwise cautious market.

The survey concentrates on the actual sale price of Ireland's typical stock home, the three-bed semi, giving an accurate picture of the second-hand property market in towns and cities countrywide.

The actual selling price of a three-bedroom, semi-detached house across the country rose by 1.3% over the quarter to €297,056 – representing an annual increase of 6.6%.

Time taken to reach sale agreed nationally has risen to six weeks as REA agents report that pricing levels are key in a sensitive market.

“There is a lot of uncertainty among the general public about the market, with many fearful of the effect of increased interest rates, tech job losses and other macro-economic factors,” said REA spokesperson, Barry McDonald.

“However, this does not appear to be stopping first time buyers from driving forward, and housing demand remains very strong.

“However, pricing is sensitive across all property types – if a property is priced too highly it will sit there, but if it is priced competitively it will attract interest and reach sale agreed quickly.”

A total of 78% of Dublin city buyers are first-timers, down 3% on Q1, while the national average is unchanged at 61%.

Prices in North County Dublin climbed at a faster rate than the city at 0.8% over the past three months, with buyers chasing properties at a lower average price of €421,670.

Cities outside Dublin experienced a 1.53% rise to an average selling price of €315,000 – an increase of 8.9% in the past 12 months.

Prices rose in Cork (1.4% to €360,000), Limerick (2.9% to €280,000), Waterford (1.8% to €285,000) and Galway (0.3% to €335,000) with demand for good quality homes and limited supply.

More than a third - 36% - of sales were directly linked to landlords exiting the market.

Commuter areas rose by 0.4% to €315,389, with 41% of buyers in areas such as Louth, Meath, Kildare and Wicklow coming from outside the county, a large proportion of them from the capital, with 72% of sales to first-time buyers.

The highest three-bed semi price rises came in the country’s main towns, rising by 2.24% in the past three months to an average of €216,517, with time taken to sell at five weeks.

“The most noticeable thing in the past 12 months is that properties that require upgrade works are seeing less interest compared to last year, which can affect the selling price,” according to Wexford agent Winston Halnon of REA Halnon Humphreys.

“Properties that are in move-in condition will get good interest. It is certainly worth preparing your property for sale in this market, as it attracts buyers.”

Areas that attract holiday home buyers have noted an increase in UK or cross border interest with examples such as Bantry in Cork and Bundoran in Donegal both recording €5,000 average increases in the past three months.