Northern Ireland house prices continued to rise in February but the market appears to have taken a more cautious turn as spring approaches.
Figures from the latest Royal Institution of Chartered Surveyors (RICS) and Ulster Bank residential market survey found the headline price balance for the province was +35%, meaning that 35% more respondents said prices rose in the past three months than those who said they fell.
The only areas of the UK with higher readings were the North West of England and Wales.
Respondents also indicated that new buyer enquiries eased back marginally last month - albeit that the three-month average is upwards - and expectations amongst surveyors for sales activity in the three months ahead lowered, with the balance for sales expectations now lower than at any time in the past five years.
However the survey said there was still little evidence of new instructions to sell picking up, which points to a continuing lack of supply in the market and the likelihood that upward pressure on prices will remain.
“Surveyors appear to be becoming more cautious about the market, perhaps based on some of the recent noise around the border and Brexit, as well the expectation that the Bank of England will raise interest rates,” said RICS residential property spokesman, Samuel Dickey.
“But this appears to be less the case regarding prices than sales activity.
“We’ve seen an ongoing shortage of properties coming onto the market for some time, and this doesn’t appear to have changed in the latest survey.
“This lack of supply will likely support current price levels and indeed potentially push prices higher in the months ahead. It also remains to be seen if the more cautious sentiment in relation to activity is sustained, or is just a short-term reaction to the recent news flow”
Sean Murphy, MD of personal banking at Ulster Bank, said: “The latest Council of Mortgage Lenders data showed that first time buyer, home mover and homeowner mortgage lending all rose year-on-year in the fourth quarter of 2017, and our own experience at Ulster Bank suggests that this trend has continued into Q1 2018. There are no doubt challenges for the market ahead - not least the lack of supply - but in our experience, owning their own home or moving house are still key goals for many people in Northern Ireland and this is likely to remain the case.”