The Northern Ireland housing market in the second quarter of this year performed at its strongest level since 2007, according to the latest University of Ulster Quarterly House Price Index, produced in partnership with Bank of Ireland UK and the Northern Ireland Housing Executive.
The survey covering April, May and June showed that the average house price was £139,720. When weighted to account for sample variations, this equates to an increase of 6.9% on the same time last year and is up by 1.4% compared with the first quarter of 2014.
The number of housing transactions continued its upward trend, with 1,997 sales reported by a network of estate agents in this survey compared with 1,409 in the same quarter of 2013.
The authors of the report Professor Alastair Adair,Dr John McCord, Professor Stanley McGreal and Dr David McIlhatton of the University of Ulster said: “The residential housing market during the second quarter of 2014 has performed at its strongest level since 2007, with both transaction levels and prices up – indicating a significant shift in market sentiment.
“Although there is still variability in prices across different house types and different areas of Northern Ireland, it would seem that the gradual recovery evident in recent surveys has moved to a new phase of greater buoyancy.”
According to the report, sales values still reflected an affordable price structure in Northern Ireland. The percentage of properties selling at or below £100,000 declined to 40% from 43% in the previous quarter, but still represented a large portion of the market.
Alan Bridle, UK Economist/Market Analyst, Bank of Ireland UK, said: "While local market performance remains highly variable, overall in Northern Ireland the recovery in house sales volumes and average prices continues. Recent regulatory changes to the UK mortgage market and the prospect of higher borrowing costs in 2015 may temper the rate of market growth but are unlikely to derail the recovery."
The Housing Executive’s Head of Research, Joe Frey, said: “The latest Quarterly House Price Index confirms our forecast made at the start of the year, that house prices would rise gently during 2014, reflecting a market in slow but steady recovery.”
Compared with a year before, all property types showed significant rises in average prices with the exception of terraced/townhouses where the average fell slightly by 0.7% to £85,643. Detached houses rose by 9.9% to £219,372; detached bungalows by 9.4% to £162,207; apartments by 8.9% to £106,503; semi-detached houses by 6% to £127,600; and semi-detached bungalows by 2.8% to £106,275.
At a regional level the overall price growth was reflected across several areas but the pattern remained inconsistent suggesting difference paces of recovery across parts of Northern Ireland.
The Belfast market performed well in the second quarter. All property types showed increased prices, with the average price increasing by 5.4% over the year.
South Belfast was again the most expensive area for housing, with an average sale price of £187,897 while North Belfast was the most affordable with an average of £91,681.
House Price Index
The long-term House Price Index, calculated relative to the base quarter for the survey in the final quarter 1984, rose significantly to 499, suggesting a potential turning point from the uneven, generally downward trend of the past three years.