Belfast Telegraph

House price rise of 9% is highest in UK

By John Mulgrew

House prices in Northern Ireland have risen by 9% in the first half of the year - outstripping the rest of the UK.

Prices across the province grew to an average of £154,000 at the end of June, according to the latest figures from the Office for National Statistics (ONS). The report said the strong growth in Northern Ireland "likely reflects an ongoing mismatch between demand and supply".

Property prices in Northern Ireland fell particularly sharply in the wake of the downturn and are still catching up with those seen in other regions.

The comparison between here and many other parts of the UK has been branded as "artificial" by economist John Simpson.

UK house prices increased by 5.7% in the year to June 2015, up from 5.6% in the year to May 2015. Elsewhere in the UK house price annual inflation was 6.1% in England, while prices only rose by 0.8% in Wales.

Scotland saw an overall fall in house price inflation, dropping by 0.6%.

Prices here still remain the lowest in the UK, and are still 42.7% below their pre-downturn peak in August 2007, highlighting the steep falls they experienced between 2008 and 2012.

Costs are continuing the consistently strong pace of growth seen since mid-2014, the report said.

Economist Mr Simpson said the comparison between Northern Ireland and the rest of the UK didn't reflect the true picture.

"We started from a lower base, and we have further to travel to get to what we could call normal house prices, stable," he said. "There could be two or three months that makes prices look like they are rising faster.

"But while we may be doing a faster adjustment, we still have a much bigger adjustment to make. We have actually had a bigger hit on our personal incomes than the average for the UK, so the fact is people aren't affluent enough to deal with the UK averages."

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