House prices dip £30,000 since February

ECONOMISTS' predictions the housing market in Londonderry had bottomed out and was improving have been proven premature with the average price of a house here falling by 24.3 per cent over the past 12 months.

The average house in Londonderry and Strabane costs a considerable 30,000 less now than it did in February.

In Limavady the cost of the average house fell by 18.3 per cent over the year. A house in the Roe Valley now costs 14,000 less than it did at the start of the year.

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The house price decline is described by the latest University of Ulster House Price Index, produced in partnership with Bank of Ireland and the Northern Ireland Housing Executive, and covers the second quarter of 2010.

It reveals: "For Derry/Strabane the overall average of 119,185 declined by 24.3 per cent over a year, suggesting that the extent of price decline might be greater than anticipated.

"Average price levels across the market were consistently lower, though the detached bungalow sector increased in average sale price over the quarter."

The authors add: "For the Coleraine/Limavady/North Coast region the overall average price of 149,299 was down over a year by 18.3 per cent continuing the trend in the previous survey. Major contributors to this decline were the very low average prices of terraced/townhouses at 77,750 and apartments at 103,788."

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The latest price index contradicts predictions earlier this year that the Londonderry housing market was improving.

The survey showed that over the previous year there had been an annual weighted rate of price growth of 2.4 per cent but compared with the first quarter of the year the overall average house price actually showed a weighted decline of 2.5 per cent.

According to the authors of the report Professor Alastair Adair, Professor Stanley McGreal and Dr David McIlhatton: "The findings of the current survey highlight the erratic and uneven behaviour of the current housing market. On the positive side the small rate of annual price growth and the higher volume of transactions are welcomed signs.

"However, the weaker price performance during the spring quarter suggests that recovery of the housing market is fragile."