The housing market in Northern Ireland continued to head higher over the last three months despite rising interest rates and concerns around the cost-of-living crisis.
That is according to residential property body the RICS (Royal Institute of Chartered Surveyors) which surveyed its estate agent members, the majority of which said prices rose in the last quarter. However, signs of a slowing market are beginning to emerge, particularly in the outlook for future months.
A majority of agents expect the market to ease in the next three months, although those in Northern Ireland aren’t as pessimistic as their peers in the rest of the UK. Meanwhile, demand has eased to the lowest level since June 2020 when the market was in the midst of the coronavirus pandemic, while the number of transactions has also fallen.
Samuel Dickey, RICS Northern Ireland Residential Property Spokesman, said the lack of supply of new houses for sale which had played a large part in driving prices higher in Northern Ireland in recent years will likely temper any slide in prices.
“Northern Ireland is still seeing some easing in enquiries and demand from extremely high levels earlier in the year, which is expected given the turbulence in the mortgage market paired with the time of year,” he said. “Whilst the market is clearly in a different place than it was earlier in the year when demand was much higher, we would expect the lack of supply to continue to be a factor in the market for the foreseeable as we continue into the new year.”
He said activity levels have held up, despite the slowdown.
“Although factors including higher interest rates are clearly weighing on surveyors’ outlook, we continue to see relative steady levels of activity in the market and I don’t expect that to change dramatically as we move into 2023.”
Simon Rubinsohn, Chief Economist, agreed and said any slide in prices won’t be as pronounced as during the financial crisis as a result of high employment levels.
“The overall tone of the latest RICS Residential Survey is understandably more downbeat than previously, reflecting the uncertain macro environment and the higher cost of mortgage finance,” he said. “However, anecdotal comments from respondents capture the very real significant divergences in market behaviour at a more localised level.
“Although the headline price balance recorded two consecutive modest monthly falls in prices, and the forward-looking series indicate that this trend will extend through the coming months, the likely 'job-rich' recession suggests the downturn in the housing market this time could be shallower compared with past experiences”
