- Expert View
- Market Trends
- Performance by Property Type
- Performance by Region
- Average House Price by Region
Northern Ireland Quarterly House Price Index for Q3 2013
This survey analyses the performance of the Northern Ireland housing market during the third quarter of 2013, the months of July, August and September.
The report is concerned with trends and spatial patterns in the housing market drawing comparisons with the third quarter of 2012, as a measure of annual change, and with the second quarter of 2013, as an indicator of quarterly change. The report is produced by the University of Ulster in partnership with the Bank of Ireland and the Northern Ireland Housing Executive.
A market best reviewed in segments
Head of Research
Bank of Ireland
Rising activity and sales momentum are the key headlines from our latest snapshot of the region’s housing market.
The largest survey sample in over 6 years confirms the anecdotal evidence that the recovery in transactions witnessed in H1 2013 accelerated over the summer months. With vendor expectations adjusting lower, the picture is one of houses selling again in greater numbers at the revised price points, with the lower end of the market again particularly active with more than two out of every five sales at or below £100,000
In terms of affordability, potential buyers will note that the average price of a property has, in the last three months, dipped below £130,000 for the first time since Q1 2005. However, the picture is inconsistent with considerable variation between location and quarterly and annual performance indicators. In this survey, the highest price sales are recorded in the Lisburn area with North Belfast at the opposite end of the range, partly reflecting the profile of sales in each location.
Apart from Belfast (South & East), North Down and Lisburn, only Mid and South Down has recorded a price above the Northern Ireland average in the last quarter. Price performance is best viewed through a wider lens but clearly, a broad-based recovery in prices across the region is still awaited.
outlook for both the UK and regional economies. The first estimate suggests Q3 GDP accelerated to +0.8%, consistent with the respective PMI surveys for manufacturing, construction and services reaching multi-year highs in recent months. While the current pace of growth may not be sustained in Q4, the barometers of business and consumer confidence are reinforcing an improving operating environment with associated upgrades to 2013 & 2014 growth forecasts. The short-term outlook for the Northern Ireland economy and housing markets has improved with positive developments in the labour and business markets, partly reflecting the “spill over” effects from rising confidence and the more favourable sentiment in GB. The claimant count has now (surprisingly) fallen for 8 consecutive months, the jobless rate has declined to 7.3% (from 7.8%) and the total number of employee jobs is edging up towards the 700,000 level again. Furthermore, a flurry of positive job announcements either side of the investment conference last month should further boost sentiment.
Head of Economics & Research
Bank of Ireland Northern Ireland
General Market Trends
In previous reports the growth in the volume of transactions has been identified as a lead indicator. This report highlights a further significant increase in sales during third quarter, up by over 20% relative to the second quarter. While the level of transactions is still lagging the peak of the market, this statistic should provide considerable comfort that the local housing market in Northern Ireland is in recovery. The growing level of market activity almost certainly reflects improving access to mortgage products, reduced deposits and various policy initiatives to stimulate access to the housing market.
Although sale volumes are appreciably up, price levels have not yet followed suit. The overall average price of residential property for the third quarter of 2013 is £129,777, a figure that is broadly similar to the second quarter average (£130,864). In simple percentage terms this represents a - 0.8% change in the overall average price over the quarter. However when variation in the sample mix is allowed for there is a quarterly weighted price increase of 1.3%. In comparison to the third quarter of 2012, the overall average price is lower by 6.6% over the year, when variation in the sample mix is allowed for the weighted decline for the year is 4.8%. Hence the picture is one of a more vibrant market with considerable variation in terms of average house price.
Performance by Property Type
Although the transaction base has grown, price trends are difficult to fully assess with considerable variability still apparent between property types.
Annual performance provides a snapshot comparing the current average price with corresponding statistics for the third quarter of 2012. There is still a legacy of variability in price performance when the market is disaggregated by property type though if transaction volumes continue to improve then the impact of thin sample sizes should dissipate. Over the year the terraced/townhouse sector (£82,902) has a higher average price (by 3.9%) and apartments (£95,187) are up slightly by 0.3%. In contrast, the average price of semi-detached houses (£118,038) is down by 3.6%. and semi-detached bungalows (£103,784) by 14.5%. The latter reflects their small representation in the sample. The average price of detached bungalows (£141,164) is down by 4.4% and detached houses is down by 9.3% over the year (£219,493) reflecting their lower price structure in the last quarter.
Annual % change and average price
|Market Sector||Annual Change||Average Price Quarter 1 2013 |
Performance by Region
At the regional level, trends are again highly variable. For certain regions, prices and variability of price trends are a function of the previous constrained evidence base.
|Location||Average Price Quarter 3|
|Northern Ireland - All||£129,777|
In terms of transaction evidence, the volume of sales for Belfast (537) is significantly up on the sample sizes for both first and second quarter indicating a more buoyant market. The overall average price (£141,625) is up over the quarter by 2.6% but is again lower for the year, down by 5.7%, though the rate of annual decline has reduced. The Belfast market is dominated by terraced/townhouses (£86,475) and semi-detached houses (£141,886) with apartments (£99,373) and detached houses (£274,636) also taking a significant market share.
|Belfast - All||£141,625|
|Belfast Metropolitan Area
Within the commuter zone of the Belfast Metropolitan Area, the three local markets continue to display contrasting positions though quarterly performance suggests more stability in the market.
For North Down, the overall average price (£155,692) is up over the quarter but lower over the year when compared with the same period in 2012.
For Lisburn, the overall average price is again high (£173,224), a figure which is virtually unchanged from the second quarter average (£172,828).
|North and North West
The overall picture in the North and North West appears to be one of increasing stability though there is little evidence of growth in price levels.
For Antrim/Ballymena the overall average price (£112,737) remains low and slightly down on that for the third quarter of 2012.
For the Coleraine/Limavady/North Coast market, the overall average price (£114,922) is relatively stable though to the downside over both the year (by 4.8%) and quarter (by 2.8%).
In the Derry/Strabane market, the overall average price (£106,362) is somewhat lower though on the positive side there is a significant increase in the volume of transactions as reflected by the larger sample.
|L'derry / Strabane||£106,362|
|Antrim / Ballymena||£112,737|
|Coleraine / Limavady / N. Coast||£114,922|
The two markets in the West of Northern Ireland are still characterised by considerable variability in terms of price levels and trends.
The Mid-Ulster market, overall average price £111,489, has seen certain price growth over the quarter with the market as a whole up by 3.4%, though price levels are still down on an annual basis.
The Enniskillen/ Fermanagh/ South Tyrone market for this quarter has an average price (£123,014) which is more in line with expectations.
|Enniskillen / Fermanagh / S. Tyrone||£123,014|
In the south of Northern Ireland, the two market areas demonstrate somewhat differing price trends.
For Craigavon/Armagh, the overall average price (£95,807) is down over the quarter but at a level more in line with expectations.
For Mid & South Down, the overall average sale price (£129,782) is up by 7.4% over the quarter though lower by 3.3% over the year.
|Mid & South Down||£129,782|
|Craigavon / Armagh||£95,807|
Average House Price by Region
The long-term house price index is calculated relative to price levels for each property type at the base quarter for the survey, the final quarter of 1984. The overall index at 473.51 is slightly higher for this survey.
The pattern of the house price index since its rapid fall during 2008-2010 has been one of uneven performance though still trending downwards. This survey marks a slight increase in the index but the gap between the house price index and RPI remains at its lowest since the end of 2003.