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Northern Ireland property prices plummet; rest of UK on rise

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16/10/2012
House prices in Northern Ireland have fallen dramatically in the past 12 months, according to the Office for National Statistics.

Prices in Northern Ireland fell by 12.8% in the year to August 2012, while all other countries in the UK posted house price rises. In Scotland property values rose by 0.5%, Welsh prices increased by 1.4% while English house prices, boosted by a strong performance in London, jumped 2.1%.

Growth in the capital was 6.3%, one of five English regions to post house price increases in the past year.

The South East (2.4%), West Midlands (1.2%), East (0.9%) and North East (0.4%) were the other areas see a rise in property values.

Prices in the South West, Yorkshire and Humber, the East Midlands and North West all fell. Excluding London and the South East, the average UK house price was flat year-on-year.

Properties purchased by first-time buyers increased by 2.9% in price over the year, reaching an average of £174,000 at the end of August.

Northern Ireland was the area of the UK with the lowest average house price overall, with the average property costing £129,000. The area with the highest price was London with a £399,000 average followed by the South East on £234,000.

Disregarding London and the South East, the average UK house price was £188,000.

Independent buying agent Gabby Adler, commented: “While parts of the country are undoubtedly quiet, in London prices continue to rise and will do until more properties come onto the market.

“There is very little choice for buyers; with some clients I only have off-market stock to show them as there is simply nothing on the market. In areas where there is high demand, houses are achieving much more than the asking price.”

David Brown, commercial director of LSL Property Services, added: “The annual growth in house prices has been steadying in recent months as the sluggish mortgage market places the brakes on the wider housing market.

“Any real upwards momentum in prices is being driven by cash investors and those with the most equity, and it’s no surprise that the biggest annual growth is centred on London, where there are simply larger concentrations of cash-rich purchasers.

“It’s still early days to see whether the Funding for Lending scheme will inject much needed activity into the mortgage market and significantly boost the number of new buyers able to secure mortgages across the UK, but prospective buyers should take comfort from falling inflation.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, added: “Money market rates continue to fall as the Funding for Lending scheme gives lenders a cheaper alternative to the usual wholesale markets, which is pushing down Swaps. As this cheaper money filters through, lenders continue to cut fixed rates in particular.

“We need 85, 90 and even 95% LTV deals to fall in price. This will really help first-time buyers, as well as trapped second-steppers looking to move to a bigger family home.”

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