House prices in Northern Ireland have eased lower on the back of rising inflationary pressures and concerns around the wider economy.
That’s according to the latest Northern Ireland Quarterly House Price Index from Ulster University which reported a 0.7% slide in prices in the first quarter of the year compared to the final quarter of 2022.
The average cost of a property in the province now stands at £203,326, with an erosion of real incomes said to be denting affordability for first time and existing homeowners alike.
However, while down on a quarter-by-quarter basis, prices are up 2.2% compared to the first quarter of 2022 and the unique characteristics of the Northern Ireland market look likely to temper further significant falls, the report said. It expected prices to remain steady for the remainder of the year on the back of a lack of supply, both of new and existing housing stock, and from signs that inflation is beginning to ease.
The latter factor is expected to mean the Bank of England won’t opt for further interest rate hikes and will, in fact, could begin to ease rates from current levels. That said, the immediate challenges around affordability remain for the market, Dr Michael McCord, Reader in real estate valuation at Ulster University, said.
“Despite this nominal decline, the market has remained steady, although it continues to face mounting and continued headwinds,” he said. “Annual inflation has not declined to expected levels resulting in interest rates reaching a 15-year high further squeezing the incomes of those on tracker or standard variable rate mortgages.”
“While market transitions have decreased markedly relative to this time last year, they are down approximately six percent from the end of last year. There are signs within
the market of increasing buyer enquires, and against the backdrop of ongoing supply-side issues, the market and price sensitivity look to have stabilised.”
