House prices in Northern Ireland up 3.3%: First year-on-year rise in six
Published 15/01/2014 | 10:45
House prices in Northern Ireland have climbed 3.3% - the first time in six years that figures for November have shown a year-on-year increase.
The average house price in Northern Ireland is now £131,000, according to the authoritative Office for National Statistics (ONS) index. The upward trend suggests that the property market here has finally turned the corner after crashing in 2007.
While the news for beleaguered homeowners is good, prices are still 49.4% below their August 2007 peak, when a survey of estate agents recorded an average house price of £240,408.
And prices in the province are also still well below those in other parts of the UK, where in some places they have surpassed their 2008 peak.
At the start of 2008, the average cost of a house in Northern Ireland was £226,000. That plummeted to just £125,000 in October 2012.
But the official government figures show that over the course of 2013, prices have stabilised and gradually started to recover, with year-on-year increases picking up pace considerably last October and November -- 4.8% and 3.3% respectively. Those figures had all been in negative territory for many years previously.
Yesterday, a separate survey indicated that house prices in Northern Ireland had climbed for the longest period since the economic downturn began.
That positive signal has been echoed across the UK, where values rose by 5.4% year-on-year, the ONS said. They soared by 11.6% in London to an average of £441,000.
After Northern Ireland at the bottom of the scale, the north east of England had the next lowest house prices with an average of £148,000, though prices there did climb by 4.2%.
Garry Best, director of Newry-based Best Property Services, said sales of semi-detached properties had doubled in 2013. But price rises were limited to terraced homes, with prices up 4% on 2011 to £62,000. "Overall it's a positive picture," he said.
Conor Mulligan, managing director of house builder Lagan Group, said its prices had not yet gone up but added: "What we are seeing is a vast increase in activity and bookings.
"Our bookings are up 60% in 2013 from 2012 and that growth was achieved in the latter six months of last year. We don't anticipate increasing prices until mid-year.
"The increases in the survey results are, in my opinion, competition in the resale market and keen interest in auction sales at the lower end."
Richard McCulloch, of Stanley Best Estate Agents in Magherafelt, Co Londonderry, said his transactions were at double the levels of one year earlier but expressed caution on rising prices.
"I have yet to see any real evidence that prices are increasing," he said.
"The rise in transactions will eventually lead to price increases, but hopefully these will be gradual so that people can get back onto the housing ladder -- but more gradually than last time."
Paul MacFlynn, a researcher at the Nevin Economic Research Institute -- which is funded by trade unions -- said that house prices should be mirrored by a rise in wages if they were to be viewed positively.
"House price increases have to be met by increasing wages or we will create another debt bubble."
AVERAGE HOUSE PRICES
Northern Ireland: £131,000