House prices will rise faster in Northern Ireland than the UK average this year, industry experts have predicted.
A 4% increase has just been forecast by the Royal Institution of Chartered Surveyors (RICS) as a result of a lack of available homes and an increase in the number of new buyer inquiries.
RICS Northern Ireland spokesman Samuel Dickey said changes will become evident in the spring.
“The gap between demand and supply is continuing to create upward pressure on prices,” Mr Dickey said. “However, this will likely rebalance at least to some extent as we move into the spring, when more properties tend to come onto the market.”
RICS is expecting prices to rise on average 4% this year, which is a more moderate increase than last year but higher than the expected 3% UK average.
RICS research suggests that demand remains strong, with new buyer inquiries continuing to rise, but enthusiasm among homeowners for putting property on the market appears less buoyant.
The housing market started 2015 as it ended 2014, with prices and sales edging upwards, and surveyors expect that trend to continue, according to the latest RICS and Ulster Bank Residential Market Survey.
Their findings suggests that demand in the local market remains relatively robust, with new buyer inquiries continuing to rise at a faster rate than instructions to sell – indicating a continuing lack of supply.
The gap between the two is widening, according to the survey.
Last night Richard McCullough, from Stanley Best Estate Agents, which has branches in Belfast, Cookstown and Magherafelt, told the Belfast Telegraph that a lack of stock was having a “big impact on what buyers are prepared to do right now”.
“A lot of people stayed out of the market when prices were going down,” he said. “Stock is falling and people are starting to panic a little.
“We are starting to see bidding wars that did not exist in the last five years.Some properties are receiving well over asking price, which is a new phenomenon that hasn’t existed recently.”
Mr McCullough added: “You have to take it in overall context. This might be a bit of a blip as property prices will stagnate again. They will have to level off eventually, which will be linked to borrowing and the wider economy.”
Northern Ireland recorded the strongest price growth in the UK, with a balance of 47% of surveyors reporting prices rising.
Meanwhile, the Office for National Statistics says house prices in Northern Ireland, which fell particularly sharply following the economic downturn, still have some way to climb to reach the levels they were at before the financial crisis took hold.
Simon Rubinsohn, chief economist at RICS, said: “There remain a number of challenges to the market, such as affordability constraints, lack of stock and an air of caution in the run-up to the general election.”
– The latest report from the Royal Institution of Chartered Surveyors says the housing market was showing a “very mixed picture” across the UK.
– Housing markets in Northern Ireland and Scotland strengthened in January as those in England and Wales cooled off.
– Northern Ireland recorded the strongest price growth, with a balance of 47% of surveyors reporting rising prices.
View this and more articles on the Belfast Telegraph.
Caption: RICS Northern Ireland spokesman Samuel Dickey