Housing market bounces back but suffers 6.7% dip over year

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The average price of a house in Londonderry and Strabane recovered by £5,000 to settle at £95,964 during the first quarter of the 2016 calendar year but is down by 6.7 per cent year-on-year reflecting a “degree of variability in the local market.”

The Northern Ireland Quarterly House Price Index, which is carried out by Ulster University, in partnership with the Northern Ireland Housing Executive and Progressive Building Society, analysed the performance of Northern Ireland’s residential housing market between January and March 2016.

The report shows that in Londonderry and Strabane the average house price of £95,964 is down 6.7 per cent over the year, but higher than the final quarter of 2015, up by 6.1 per cent, suggesting “a degree of variability in the local market.”

Analysis by individual property type is, however, indicative of a more consistent market.

The average price of terraced/townhouses; at £64,226 has increased by 6.4 per cent over the year and by three per cent over the quarter.

Similarly, detached houses at £147,962 are up by 9.2 per cent annually and by 3.1 per cent since the last quarter of 2015.

The performance of semi-detached houses at £102,156 is however slightly more inconsistent, down by 4.4 per cent annually, showing a slightly improved performance, up by 0.4 per cent for the quarter.

At a regional level, a broadly similar pattern of lower average prices is apparent for the first quarter of 2016.

Two thirds of houses were sold at or below £150,000 making Northern Ireland a buyer’s market, and more affordable than other UK regions.

Lead researcher, Professor Stanley McGreal, from Ulster University, said: “The research statistics are reflective of mixed feelings by the sector across Northern Ireland with some estate agents attributing the apparent slowing in first quarter simply to a seasonal fluctuation, others to house buyers’ concerns of economic uncertainty.

“When it comes down to overall performance by property type, the average prices of terraced/townhouses, detached bungalows and apartments have increased over the year.

“In contrast semi-detached and detached houses have experienced a slower rate of annual growth.

“Over the quarter, all property types, with the exception of semi-detached bungalows, have suffered reduced price levels.”

The report also shows that there’s been a sharp decline in affordability in Belfast but not in Londonderry.

“Belfast had the highest savings ratio (1.70; compared to 1.50 in 2014), indicating that a household on median income would now need almost

two years to save the necessary deposit for a home at the lower end of the market.

“In contrast the Derry, Strabane and Limavady housing market area recorded a decline in the savings ratio from 1.34 to 1.15, reflecting a more

subdued market,” the report’s authors state.