NI housing market ended 2020 in growth, but signs show easing

The December report points to rising activity in the Northern Ireland market and further rises in prices. However, the pace of growth had softened.

A net balance of +47% of Northern Ireland respondents said that prices rose, compared to +76% who said so in the November report.

When it comes to activity, a net balance of +27% or respondents reported rising new buyer enquiries in December compared to +44% the previous month. Similarly, +28% reported a rise in newly agreed sales, down from +49% in November.

Looking ahead, Northern Ireland surveyors expect both sales activity and prices to continue to increase over the next three months. However, these figures were relatively modest when compared with those reported at the middle of 2020. The December survey reports that a net balance of +14% expects sales activity to increase over the next three months and +26% expects prices to rise in the same timeframe.

Samuel Dickey, RICS Northern Ireland Residential Property Spokesman, said: “Whilst the wider economic environment is challenging with the ongoing pandemic and restrictions, plus the complications from Brexit, the housing market has continued to be busy. People continue to put a high priority on their home and the desire to have more space, and access to green space, continues to drive many people’s desire to buy or move house. These factors are unlikely to change in the near future.”

Terry Robb, Head of Personal Banking at Ulster Bank, continued: “Mortgage activity continued to be very strong at the end of 2020. Ulster Bank reintroduced 90% mortgages in December which has led to further enquiries. For first-time buyers, raising a deposit is still the biggest challenge. By reintroducing our 90% offering, we are pleased to be able to expand our support for the market to include both home movers and first-time buyers, making it easier to take their first step onto the housing ladder.”

Commenting on the UK picture, Simon Rubinsohn, RICS Chief Economist, added: “Although the housing market remains open for business in the midst of the latest lockdown, there is a sense from respondents to the survey that the new restrictions will still impact on transaction activity over the coming months. This is most visible in the negative reading for sales expectations over the next three months when typically, with the expiry of the stamp duty holiday approaching, this series would be expected to remain firmly in positive territory.

“Looking beyond this immediate time horizon, the feedback from RICS members is that the uplift in prices over the past year will be sustained, for good or ill, as the macro picture gradually improves on the back of the rollout of the Covid vaccination programme. More significantly, private rents are envisaged to outpace price gain as supply continues to fall short of demand with anecdotal reports of landlords exiting the market.”