Trend Of Slowing House Price Growth Continues

16th Jul 2007

House price inflation slowed for a third consecutive month during June, according to a leading local study. The RICS (Royal Institution of Chartered Surveyors) and Ulster Bank housing market survey reveals that although Northern Ireland price growth was in excess of all other UK regions last month, a considerable slowing of inflation has taken place since March.

40 per cent of chartered surveyors responding to the survey reported price growth of between 0 and 2 per cent in June, with 30 per cent recording inflation in excess of 2 per cent. 21 per cent reported that prices remained the same, with 9 per cent experiencing moderate falls.

75 per cent of chartered surveyors had recorded inflation of at least 5 per cent during March the high watermark for price growth since the survey began.

RICS Northern Ireland residential property spokesman, Tom McClelland, says: The residential property market has changed considerably in the last quarter. We have moved from a situation earlier in the year where houses were selling in a matter of days or weeks and often for 25 per cent or more above their asking price, to one now where by-and-large houses are achieving asking price or moderately above and where sales are frequently taking months rather than weeks.

Mr McClelland says the evidence suggests house prices will grow moderately in the coming months. We now have a clear trend of slowing house price inflation, which is likely to continue in light of recent and likely interest rate rises, he says.

Mr McClelland adds: The Executive is currently positioning itself to deal with Northern Irelands considerable housing affordability crisis and the RICS will continue to engage with relevant Ministers in the coming months in order to ask for and support measures and interventions to increase the supply of affordable homes and to allow first time buyers and lower income households to enter into homeownership.

Ulster Bank Head of Mortgages, Derek Wilson, says: We are still experiencing strong house price growth in Northern Ireland, but the rate of that growth has slowed quite significantly from its peak earlier in the year. Price inflation is being supported by a relatively buoyant economy and jobs market, but the rate of growth is declining due to an increase in the supply of new build homes coming to market, the increasing costs of borrowing and the fact that investors are selling up in increasing numbers in order to invest in less inflated housing markets.

With the continuing interest rate tightening cycle and with local house prices so high, it is now more important than ever for homeowners to ensure that they are getting the best mortgage deal available to them, he adds.

RICS (Royal Institution of Chartered Surveyors) is the mark of property professionalism worldwide. It covers all aspects of property, construction and associated environmental issues. RICS has 130,000 members globally and represents, regulates and promotes the work of property professionals throughout 121 countries. RICS is governed by a Royal Charter approved by Parliament which requires it to act in the public interest. It is also a professional regulatory body approved by Government (HM Treasury).