THE average house price in Craigavon is now £222,617 - with little sign the heat could soon be going out of the property boom.
According to the latest figures the overall average price represents a significant increase in annual house prices of 54.4% compared to the first quarter of 2006.
There have been major increases in average price across the market, though most notably for semi-detached houses up by a staggering 66.9% to 211,178 and detached bungalows up 66.3% to 260,588.
The overall average house price in Northern Ireland has comfortably passed 200,000 for the first time, according to the most comprehensive survey of local residential property sales.
The latest University of Ulster Quarterly House Price Index, produced in partnership with Bank of Ireland and the Northern Ireland Housing Executive, and covering the first three months of 2007 showed prices up 46% over the year and by 11% over the quarter. The figures suggest that rather than slowing down, the market moved (is moving) in the opposite direction as prices rose further still in the period to the end of March.
The average house price in Northern Ireland is now 215,590 putting it ahead of Scotland, Wales and the whole north of England.
The University’s survey is the broadest-based and most authoritative of all those undertaken in Northern Ireland. In the first quarter it covered a sample of 2,120 housing transactions involving more than 100 firms of estate agents across all areas.
In the latest report, the authors - Professor Alastair Adair, Professor Stanley McGreal and Mrs Louise Brown – say there is no early sign of the market slowing-up despite recent interest rate rises, although they point out there can be a delay in how quickly such changes impact on the market.
Mrs Louise Brown said: “The Northern Ireland housing market is still strongly influenced by the role of investor activity which has driven price levels to new record highs in the first quarter of 2007, though our expectations are for lower rates of increase as the year progresses.”
Bank of Ireland’s Head of Research in Northern Ireland, economist Alan Bridle, said the survey confirmed that the region remained in the throes of an unprecedented price boom in the early part of this year although he cautions that the long awaited moderating of price inflation may already be underway
He said: “The survey shows that we are living through remarkable times in Northern Ireland, however in time, the first quarter of 2007 may prove to be the high watermark as far as Northern Ireland’s rate of residential inflation is concerned.
“Since Easter, close observation of the housing market would suggest that at long last, the local price boom may be starting to come off the boil with a return to a more normal market. Evidence to date is largely anecdotal, but it will be a major surprise if we are not reporting a slower rate of inflation in our next survey in the late summer.”
With the shrinkage in the number of houses selling at or below 100,000, the survey once again highlights the issue of affordability, particularly for first-time buyers. Property at or below 100,000 accounted for only two per cent of properties in the survey sold – virtually eliminating them from the survey, 17% were in the 100,000 - 150,000 bracket compared to 26% in the last quarter and 35% were in the 150,000 to 200,000 price range. Some 24% sold for between 200,000 and 250,000 and a further 22% were sold for above 250,000. 12% of the sample went for at or above 300,000.
The Housing Executive’s Head of Research, Joe Frey commented: “This latest price increase only reinforces the urgency of the need to address the affordability problems faced by first-time buyers throughout Northern Ireland. The new Minister responsible for Housing, Margaret Ritchie, faces an increasingly challenging task.
In order to tackle the problem successfully the Minister needs the support of the Department of the Environment, Department for Regional Development, and Department of Finance and Personnel as well as the private sector.
However, we may already have seen the start of a reversal of the trend towards increasing owner occupancy, with more newly forming households having no alternative but to enter and remain in the private rented sector for much longer periods.
Since the survey began in 1984, the rate of house price growth in Northern Ireland has been significantly above the general rate of inflation – a key reason for the high level of investment in the housing market. The University of Ulster’s House Price Index has reached another new peak of 850.6 relative to the 1984 base.