Editorial: Northern Ireland house prices are relatively stable now, and that is a good thing

House prices in the UK fell in March for the first time in six months, according to the Halifax.

The lender said that prices dropped by 1% last month, partly due to higher mortgage rates, which make borrowing more expensive.

Earlier in the year the Halifax found that prices rose in Northern Ireland faster than in any other part of the UK.

What is going on?

Well, to get a sense of the true picture in the province, in comparison to the rest of the nation, you need to go to the Land Registry house price index. It is highly reliable because it is based on actual concrete sold price data.

It finds that NI has an average house price of £178,000, which is still down on the mid 2007 peak of £225,000. We are the only region of the UK not to have recovered from the 2008 housing crash.

If you adjust house prices for inflation, then the correction is even more stark. The 2007 price is about £363,000 in today’s money, far above current levels. NI has not recovered in the way that Great Britain has done because we had a much bigger boom. Prices rose to a point far, far above what was justified based on NI income levels.

Yet the boom, when it was happening, was celebrated. This was understandable in a way, because it seemed to be a reflection of the Paisley-McGuinness moment of a new post Troubles era. There was optimism in the air.

Yet while there was a fair expectation of better times, there was also insufficient concern about soaring prices. Religious ministers, political leaders, economists and others mostly failed to warn people about the problems of growing rich in their homes, such as making houses so expensive as to shut younger generations out of property ownership.

Now we have affordable, and gently rising, prices that are justified by the fundamentals. Housing booms and busts are bad. The current home price stability is good for NI society as a whole.