NI House Prices Start to Rise

House prices in Northern Ireland have risen by more than 2% in the last quarter leading to suggestions that the property downturn in the province may have run its course. The latest figures, which come from the University of Ulster House Price Survey were released yesterday. The average price in the third quarter of 2009 was £164,017 compared with £158,886 in the second quarter. This remains some distance from the average house price of £250,000 when the market was at its height in 2007.

The report's authors, Professor Alastair Adair, Professor Stanley McGreal, Louise Brown and David McIlhatton, said "the recovery in the housing market is still piecemeal". They added, "Positive signs are the declining rates of annual price decrease across the different sectors of the market and an overall weighted increase over the last quarter of 2.1%. But sales transactions, at best, are only a third of the volume expected under normal conditions, suggesting that the market still has some distance to go."

Economist Alan Bridle of Bank of Ireland Northern Ireland said: “The overall climate for housing remains challenging. There is little substantive evidence as yet of a real breakthrough in the number of first-time buyers entering the market.” He went on to say "While the end of the recession may be in sight, the legacy of a difficult economic and financial backdrop will remain. Rebuilding confidence may therefore take some time."

There also appears to be a fairly wide amount of regional variation to the recovery with homeowners in North Down enjoying a rise in prices by around 26.8% this quarter and those in Belfast experiencing a 7.6% increase. There are fewer signs of recovery in the north and west, where prices continue to fall. Coleraine/Limavady/North Coast saw values drop by 8.9% compared to the second quarter with a similar story in Derry/Strabane down 6.6%. The Enniskillen/Fermanagh/South Tyrone area experienced a drop of 8.6% and Mid and South Down declined by around 5.5%.