Northern Ireland sees strongest house price growth

Northern Ireland was the strongest performing region while London was once again the weakest with house prices down 1% year-on-year, The Nationwide House Price Index found.

Northern Ireland saw acceleration in growth in the first quarter, with annual price growth accelerating from 2.0% to 7.9%.

London continued to experience modest annual price declines, with average house prices down 1% compared with a year ago.

Annual house price growth remained subdued in March with annual house price growth steady at 2.1%.

Robert Gardner, Nationwide’s chief economist, said: “UK house price growth remained broadly stable in March at 2.1%, little changed from the 2.2% recorded the previous month. House prices fell by 0.2% over the month, after taking account of seasonal factors.

“On the surface, the relatively subdued pace of house price growth appears at odds with recent healthy rates of employment growth, a modest pick-up in wage growth and historically low borrowing costs.

“However, consumer confidence has remained subdued, due to the ongoing squeeze on household finances as wage growth continues to lag behind increases in the cost of living.

“Looking ahead, much will depend on how broader economic conditions evolve, especially in the labour market, but also with respect to interest rates. Subdued economic activity and the ongoing squeeze on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year.

“But historically low unemployment and mortgage interest rates together with the lack of properties on the market is likely to provide some support for house prices. Overall, we expect house prices to be broadly flat, with a marginal gain of around 1% over the course of 2018.”

Wales saw a pick-up in annual house price growth, from 3.3% in the year to Q4 2017 to 6.1% in Q1 2018. But conditions remained more subdued in Scotland, where prices were essentially unchanged compared with a year ago.

The West Midlands, the top performing region in 2017, had the strongest price growth amongst the English regions, with prices up 4.9% year-on-year.

Average house prices in England increased by 0.9% in the first quarter of 2018 and were up 1.9% year-on-year.

Home ownership rates have declined across all English regions over the past decade. While the decline has been fairly uniform across regions, the biggest reduction has been in London, where the home ownership rate has fallen from 57% to 47%.

Jeff Knight, director of marketing at Foundation Home Loans, said: “The first quarter has been typically sluggish – typically a period when buyers and sellers contemplate their next move.

“While there is talk of a cooling London market and narrowing north-south price divide, let’s look at the bigger picture: prices are holding and, particularly for those first-time buyers, affordability remains an issue. Even with those benefiting from stamp duty cuts and low mortgage rates, the lack of supply remains the nagging problem.”

“It’s imperative more is done to support not only those seeking a first or second home but also those seeking rented accommodation to tide them over.

“Minimal choice, poor standards and unaffordable prices risk many feeling alienated in the market and in time will impinge future activity.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “This is another example of what we have seen in other surveys and on the ground – of higher and still rising prices in northern areas in contrast with London and the south east.

“Prices in the latter are turning negative as buyers and sellers come to terms with new market realities.

“Fewer forced sellers and less dependency on mortgages means that the level of price falls is staying low. This pattern began in early 2015 in response to higher stamp duty, tax changes, affordability and Brexit uncertainty, despite lower interest rates and unemployment.

“There is a long way to go but if this price drift downwards continues, the north/south divide will continue to narrow, although there is no sign of any larger market correction at present.”


‘Buoyant’ NI housing market outperforming UK’s at start of 2018

buyer enquiries rising

THE Northern Ireland housing market has started 2018 in a positive manner, with prices increasing and demand strong, according to a new industry survey.

The latest RICS (Royal Institution of Chartered Surveyors) and Ulster Bank Residential Market Survey for January has revealed that surveyors in the north continue to display greater positivity regarding the housing market than in the UK as a whole, but a lack of supply in the local market remains a cause for concern.

In Northern Ireland new buyer enquiries continued to increase firmly, according to the survey, whilst newly agreed sales edged up. Expectations for sales and prices also remain in positive territory, with only the north west of England displaying a higher reading in terms of the latter.

The positive picture is in direct contrast to the UK-wide picture, with new buyer enquiries, instructions and sales all continuing to drift lower while the three-month expectations point to a flat picture in the near future.

Concerns in relation to supply in the Northern Ireland market remain though. Whilst new buyer enquiries are reported to be rising firmly, the data for instructions to sell suggests that few properties are coming onto the market- pointing to a gap between supply and demand.

Respondents point to this shortage of supply as a concern in the months ahead and also indicated that higher costs of building materials will act to push up the price of new build homes.

RICS residential property spokesman, Samuel Dickey said the picture presented of the market in Northern Ireland is “considerably more positive” than in some other UK regions, with prices reported to be rising and a growing number of potential new buyers active in the market.

“Surveyors are also relatively positive about the outlook, but there are a number of factors that could influence these outcomes including a rise in interest rates, a shortage of supply and economic wider conditions. The increased cost of building materials combined with demand for higher quality homes will also act to make new-build properties more expensive,” he said.

Sean Murphy, managing director for personal banking at Ulster Bank, said it is no surprise the local housing market remains “relatively buoyant”.

“There’s no doubt that there are economic challenges ahead for 2018, including rising inflation, but the evidence suggests that people continue to want to own their own home and that the outlook for the market among surveyors remains quite upbeat.”

Reflecting on the survey findings, Co-Ownership chief executive, Mark Graham added:

“With more interest from new buyers, yet fewer instructions to sell, housing supply and demand remains an issue for the local housing market. Northern Ireland has had a legacy of underbuilding for over a decade. The reality is that we are still not building anywhere near enough homes to meet demand. Indeed, it is estimated that we need to be building something in the region of an additional 2,000 homes per annum in Northern Ireland, particularly in today’s market when the buyers’ preference is increasingly for new-build properties.”

“Not only do we need to see more new housing developments, but we need new stock of affordable houses to support these buyers,” he said.


Housing Market Ending 2017 on a High

ulster uni

Northern Ireland’s housing market looks set to end 2017 on a high and to enter 2018 with a healthy momentum, according to the latest report from the Royal Institution of Chartered Surveyors (RICS).

Produced with the Ulster Bank, the Residential Market Survey says house prices and sales rose firmly with surveyors expecting both prices and sales activity to increase in the three months ahead.

The main findings show a headline price balance of +40%, meaning that 40% more surveyors said that prices rose in the past three months than those who said they fell.

The price expectations balance, at +23%, remains positive and above most other UK regions, while, sales expectations data (+12%) also remains in positive territory.

Newly agreed sales (+49%) rose firmly in November, whilst there were also increases in new buyer enquiries (+33%) and new instructions to sell (+11%).

Looking further ahead, surveyors are also positive about the prospects for house prices and sales over the next 12-months, with the balance of respondents expecting both sales activity and prices to be higher in a year’s time.

However, respondents continue to report that a lack of housing stock is a challenge for the market. “Overall, 2017 has been a good year for the local housing market,” said RICS residential property Spokesman, Samuel Dickey.”

“We have seen relatively healthy rates of price increase and rising sales activity. Looking ahead to 2018, there will be a number of headwinds, including the limited supply, alongside rising inflation and the fact that interest rates are edging upwards.”

However, surveyors appear to be reasonably confident about the market in the year ahead.” Sean Murphy, MD, personal banking at Ulster Bank, said. “The RICS figures are in line with other indicators in pointing to a relatively strong year for the housing market.”

“The latest NI House Price Index, for instance, reports average prices rising 6% year-on-year, and the latest CML mortgage lending data shows that home buyers in Northern Ireland borrowed £480 million in the third quarter of the year, up 12% on the second quarter of 2017 and 20 per cent compared to the third quarter last year.”

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Northern Ireland house prices rise by 4.4% to £129,000 average

The average house price in Northern Ireland is now £129,000, official figures show.

That represents an increase of 4.4% over the year, according to a report released by the Office for National Statistics, the Land Registry and other bodies.

The north west of England led the way for house price growth over the past year, while London has seen the smallest annual increase across the UK.

Overall, average prices increased by 5% in the year to August, up from an annual increase of 4.5% in July. House prices were also up by 0.5% month-on-month, taking the average UK property value to £226,000 – £11,000 higher than in August 2016.


NI house sales survey suggest ‘mixed picture’ in market

House sales in Northern Ireland during the three-month period from April to June were at the highest level recorded since the 2007 property crash.

However, the average price is slightly down, falling by 1.1% over the quarter.

The figures were published in the Ulster University’s latest Quarterly House Price Index report.
It suggests the “mixed picture” could be influenced by a range of factors, including political uncertainty over Brexit and the stalemate at Stormont.

‘Subdued prices’

The report was compiled by Ulster University, in partnership with the Northern Ireland Housing Executive and the Progressive Building Society.

It found that the average house price now stands at £148,500. The figure has fallen by 3.7% over the year.
But the 2,372 house sales recorded between April and June meant the quarter saw the highest rate of property transactions in a decade.

“This latest survey has mixed messages regarding the health of the Northern Ireland housing market,” said the report’s lead researcher, Professor Stanley McGreal.

“Transaction levels are high suggesting a strong market in the second quarter of 2017, however, this optimism is not reflected in average prices which are generally more subdued,” the Ulster University academic added.
Progressive’s deputy chief executive, Michael Boyd, said: “There is no doubt that wider economic and political factors are having an impact including uncertainty following the triggering of Article 50, wage growth lagging behind inflation and the potential for the rise in interest rates.”

But he added that there was still “confidence” in the housing market, as Northern Ireland remained “one of the most affordable regions of the UK”.


Property Ladder – Rush to downsize

Estate agents are reporting a surge in inquiries from customers wanting to downsize to raise cash but warn that unrealistic sellers are struggling to find homes, a new survey has found.

The research by equity release referral service by Key Partnerships shows that more than two out of five (44%) estate agents have seen a rise in inquiries from older homeowners looking to downsize in the past year.

However 62% of estate agents warn would-be downsizers have unrealistic expectations about how much they will raise from moving to a cheaper home – and that’s if they can find one.

More than half (56%) of estate agents say there is a shortage of homes on the market suitable for downsizers and 68% warn there are not enough homes available for older buyers who are less mobile.

Key’s research found estate agents are increasingly suggesting lifetime mortgages as an alternative way to raise money for downsizers – around 44% of estate agents say they regularly suggest equity release plans which enable customers to take out money while staying interest-free in their homes. Meanwhile mortgage experts are warning of a slowdown in the housing market – the Council of Mortgage Lenders says the housing market has “stalled” with the number of home movers falling by 9% in the past year.

Will Hale, director of Key Partnerships, said: “When downsizing works it can be an ideal solution for older homeowners but sellers need to be realistic about how much they are going to make and it appears many are struggling to find suitable homes.

“The shortage of homes for sale is pushing up prices for downsizers who may struggle to raise the sort of money they are expecting to help with retirement planning while also having to go through the upheaval of moving home.

“Equity release should be part of all conversations with older homeowners considering downsizing, when for many it simply doesn’t add up. Estate agents who can offer equity release as a potential alternative are able to benefit from an additional revenue stream by referring potential clients to a specialist.”


Average house price rises to £211,671 as property market growth continues

HOUSE prices are predicted to grow by around 2 per cent across 2017, according to a report showing that property values continued to head upwards in July.

Across the UK, the average house price reached £211,671 in July – a new record for Nationwide Building Society’s index.

Property values increased by 0.3 per cent month on month and by 2.9 per cent annually. A year earlier, in July 2016, annual house price growth was running at a stronger pace of 5.2 per cent.

Robert Gardner, Nationwide’s chief economist, said a lack of homes for sale is helping to support house price growth – although he also said it could become more of a buyers’ market in the coming months.

He said prices are expected to rise by around 2 per cent over 2017 as a whole – “only modestly lower than the levels recorded in recent months”.

Mr Gardner said: “A lack of homes on the market appears to be providing support, with annual house price growth remaining only just outside the 3 per cent-6 per cent range, that has been prevailing for most of the past two years.

“This pattern looks set to be maintained in the near term. Survey data point to relatively sluggish levels of new buyer inquiries, but at the same time surveyors report that relatively few properties are coming on to the market.”

Mr Gardner said ultimately housing market developments will depend on wider economic performance.

He said: “While employment growth has remained relatively robust, household budgets are coming under pressure as wage growth is failing to keep up with the rising cost of living.

“This suggests that housing market activity is likely to remain subdued, with the balance in the market shifting a little further towards buyers in the quarters ahead.”

Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said: “Fortunately there does seem an enthusiasm among serious buyers and sellers to get on with the job in hand.

“The current climate is also providing an opportunity for first-time buyers at least to better compete for smaller properties.”