Signs of recovery in housing market

The University of Ulster Quarterly House Price Index figures also reveal that the greatest fall took place in the value of terrace townhouse properties, with the average price considerably down at 70,500.

However, semi-detached properties have increased in value by 5.2 per cent while detached houses are up by 11.9 per cent.

Craigavon’s fall was broadly similar to the overall Northern Ireland market.

The authors of the report, which was produced in partnership with the Bank of Ireland and the Northern Ireland Housing Executive, claim the market here is improving, with the number of transactions at their highest for the past two years.

It cites that the rate at which house prices were falling had dropped from 35 per cent at the start of 2009 to just below seven per cent 12 months later.

The authors of the latest report said: “This latest survey indicates an improving housing market. Although overall average prices are still down, the rate of price decline has slowed significantly, with prospects for a modest increase in price levels during 2010.”

The price statistics are based on a sample of 1,050 transactions in the fourth quarter of last year. Although that is about half of what would be expected under normal conditions, the report said there had been a significant increase in the number of sales from recent surveys, suggesting a recovery in the market could be underway.

The survey put the overall average price of a house in Northern Ireland in the last three months of last year at 161,429.

Alan Bridle, Head of Economics and Research at Bank of Ireland Northern Ireland, said, "The real mark of recovery in our housing market will be a pick-up in the number of transactions. This survey sounds an encouraging note.

“Steady progress in activity levels may be the most likely and desirable scenario for this year but in my view we should not expect much of a rebound in average prices and there is still a risk of them slipping further.”

The economist added that first-time buyers, although having to find higher deposits, now had lower debt-servicing costs. He said interest payments as a percentage of income were now back at ‘pre-boom’ levels of around 14 per cent.