Supply improvements to boost sales activity
More available properties and an increasing number of interested buyers will lead to a rise in sales activity over the next three months, according to the latest RICS (Royal Institution of Chartered Surveyors) and Ulster Bank Northern Ireland Residential Market Survey.
New instructions to sell (+30 percent) and new buyer enquiries (+18 percent) both rose according to the February report. As a result, sales expectations in Northern Ireland are currently the highest in the UK (net balance of +39 percent).
In terms of prices, momentum remained strong (+50 percent) in February, however expectations for prices, whilst still positive, are now lower than at any time since November 2014. Over the course of 2016, RICS expects Northern Ireland house prices to rise by 5 percent.
RICS Northern Ireland Residential Property Spokesman, Samuel Dickey, says: “A lack of supply has been the main constraining factor in the Northern Ireland housing market during recent times. This has held back sales activity and kept upward pressure on prices. However, surveyors are reporting perhaps the first signs that these conditions might be easing, with an indication that some more properties are becoming available and price expectations therefore softening slightly. As a result, surveyors expect sales activity to increase.”
Sean Murphy, Regional Managing Director, Branch & Private banking at Ulster Bank, says: “The latest figures from the Council of Mortgage Lenders show that lending in Northern Ireland for house purchase and remortgage increased in the fourth quarter 2015. At Ulster Bank, we have seen a continuing increase in mortgage activity into the beginning of 2015 and we expect it to increase further as we move into the traditionally busy period for the housing market. Ulster Bank is committed to helping people take steps into home-ownership, to move home, and to remortgage. Our participation in the Help to Buy ISA scheme and our wide range of other mortgage products are a strong sign of that commitment.”
Commenting on the UK-wide picture, RICS Chief Economist, Simon Rubinsohn, said: “Over the past three months, we have witnessed a surge in buy-to-let activity. Since the Chancellor made his Autumn Statement announcement last November, investors have rushed to purchase homes before the Stamp Duty surcharge comes into effect. It is inevitable that over the coming months, April’s Stamp Duty changes will take a little of the heat out of the investor market. While there remain significant doubts as to whether the Government’s plans to encourage a more robust development and construction pipeline will be sufficient to address the housing crisis, long-term price indications for the housing market remain strong, with respondents still expecting them to rise by a further 25 per cent over the next five years.”