Belfast Telegraph

Wednesday 27 August 2014

Republic's recovery is positive for Northern Ireland

David Elliott, Business Editor
David Elliott, Business Editor

Two factors have accentuated the downturn in Northern Ireland: property and the Republic.

Because our housing market fell so spectacularly over the last few years we felt the depth of recession more than most, with negative equity becoming all too common.

And because our biggest trading partner, the Republic, got itself in to even deeper difficulties, we have struggled to recover with any great speed.

Its own property market took a hammering too, but latest data suggests it's recovering with gusto, a factor which should spell good news for us.

The stats are pretty impressive, with the average house price in the Republic up 3.6% in September compared to a year earlier.

And if you take just Dublin, prices are up a whopping 12.6% year-on-year.

Our own property market has been showing signs of recovery but as yet, nothing as impressive as across the border.

Indeed, Northern Ireland's property market appears similar to the Republic in that it is progressive on a two-tier basis, with the markets in the major cities of Belfast and Dublin recovering and those in outlying areas wondering what all the fuss is about.

Time will tell whether the price rises are sustainable but there's no doubt the latest data will be a boost for Dublin.

It's planning to do away with its European Union armbands by the end of the year.

It reckons it can do without the bail-out money from the EU and will go back to the money markets to raise funds.

That too is good news for us, as the prosperity of our biggest export market is key to our own prosperity.

Meanwhile, it seems confidence is building here also.

The willingness of households to spend is at a six-year high, consultancy Nielsen's survey of consumer confidence and spending intentions showed.

Lets just hope that this time, the harsh lessons learned during the credit crunch aren't forgotten.

Perhaps a celebration of steady growth, rather than stellar growth should be the order of the day for both property prices and GDP.

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