House prices in Northern Ireland have managed to buck the wider UK trend and edge higher despite a slight easing the tight supply picture, according to two residential property surveys.
Both building society Halifax and estate agents’ body the Royal Institute of Chartered Surveys (RICS) showed an uptick in prices on an annual basis, although the rate of price rise has eased as a result of inflationary pressures and rising interest rates.
Halifax put the average price of a property in the province at £187,334 in May, up 1.5% on the same month last year and 2.7% on April. Across the UK as a whole, prices were down 1% on the year.
The RICS and Ulster Bank Residential Market Survey found that a majority of agents reported that house prices rose last month and most expect that upward trend to continue. There were also increases in activity last month, as well as an uptick in new buyer demand. Meanwhile, supply also edged higher for the second months in a row, a move which will ease the stubbornly tight supply picture.
“It is encouraging that surveyors reported a pick-up in agree sales in May having seen a dip in April,” Samuel Dickey, RICS Northern Ireland Residential Property Spokesman, said. “Otherwise, indicators appear relatively steady with values continuing to hold and indeed if anything edge upwards.
“Surveyors are also continuing to report seeing new buyers active in the market, which bodes well for activity,” he said. “Comparing the latest survey to the wider UK results, overall, surveyors in NI continue to be more optimistic about the next number of months.”
However, Kim Kinnaird, director of Hallifax Mortgages, said headwinds persist for the market.
“With consumer price inflation remaining stubbornly high, markets are pricing in several more rate rises that would take Base Rate above 5% for the first time since the start of 2008. Those expectations have led fixed mortgage rates to start rising again across the market,” she said. “This will inevitably impact confidence in the housing market as both buyers and sellers adjust their expectations, and latest industry figures for both mortgage approvals and completed transactions show demand is cooling. Therefore, further downward pressure on house prices is still expected.
