NI house prices now down 42% from peak

Graham_Devon

http://www.bbc.co.uk/news/uk-northern-ireland-13443958

However, when it comes to giving the reasons, its not over supply thats stated. It's reposessions that are highlighted.

Terraced and town houses fared the worst, with their values plummeting by more than a quarter in the past year.

One of the reasons for this, the authors of the study said, is because of the number of re-possession on the marke

What's also been stated on the article is that house prices now align with incomes. So it's taken a 42% drop to get there.

Maybe it's not all about over supply. Maybe, therefore, we are not as sheltered as some would have us believe. Dunno. Just looking around the box.

live'n'learn

Mine was on for sale @ £160k in 2007 now its worth about 70k

Generali

Graham_Devon wrote: »

http://www.bbc.co.uk/news/uk-northern-ireland-13443958

However, when it comes to giving the reasons, its not over supply thats stated. It's reposessions that are highlighted.

What's also been stated on the article is that house prices now align with incomes. So it's taken a 42% drop to get there.

Maybe it's not all about over supply. Maybe, therefore, we are not as sheltered as some would have us believe. Dunno. Just looking around the box.

Repos add hugely to supply as they will go up for sale at whatever price the bank can get.

I guess a difference between NI and the mainland is that if people on the border can head a few miles south and buy a place cheaply then that will have a depressing effect on prices.

wotsthat

Generali wrote: »

I guess a difference between NI and the mainland is that if people on the border can head a few miles south and buy a place cheaply then that will have a depressing effect on prices.

I wonder if this is as easy as it sounds. From my experience of driving in NI I'd expect that a commute into somewhere like Belfast from the Republic would be a nightmare. Plus there's a currency exchange involved as well.

Newry or Armagh might be OK though - it would be interesting to know if these had dropped significantly more than Belfast as this would point to an Irish oversupply impact.

The repos will have an effect - banks have no interest in 'sitting put' until prices recover.

doire_2

Generali wrote: »

Repos add hugely to supply as they will go up for sale at whatever price the bank can get.

I guess a difference between NI and the mainland is that if people on the border can head a few miles south and buy a place cheaply then that will have a depressing effect on prices.

Thats not true. I know plenty of people originally from Derry who bought over the border and now want back to NI again.
They get paid in sterling but pay mortgage, bills, council payments etc in Euros and cost of living is crippling them.

There is one builder just over the border from Derry (Bridgend) who couldn't build enough houses during the boom for people from NI. I spoke to him about 18 months ago and he was only building to order. He hasn't built one house since.

tara747

I saw that article, good to see houses becoming more affordable.

keysey wrote: »

Mine was on for sale @ £160k in 2007 now its worth about 70k

Where is your house, if you don't mind me asking?

HAMISH_MCTAVISH

Contagion from ROI both in the boom and bust. NI prices Rose 120% or something silly in the 3 years before the crash versus more like 30% in the mainland.

A 40% fall only puts them back to 2006 levels.

Graham_Devon

HAMISH_MCTAVISH wrote: »

Contagion from ROI both in the boom and bust. NI prices Rose 120% or something silly in the 3 years before the crash versus more like 30% in the mainland.

A 40% fall only puts them back to 2006 levels.

They also came to the boom party a bit late. So context is needed.

Sibley

I hope you are not trying to say prices in UK will follow because they won't. They will increase.

debtistheft

Sibley wrote: »

I hope you are not trying to say prices in UK will follow because they won't. They will increase.

UK prices not only need to fall to affordable prices, they will fall to affordable prices. The only way to pay for high house prices is to have cheap credit. In case no one has noticed, we don't have cheap credit any more except for those lucky enough to be on low trackers and those with high LTVs, neither of which first time buyers have.

Property owners are resisting the inevitable at the moment, but unless they want to stay locked in their houses indefinitely they will have to sell at a lower price.

leftieM

Graham_Devon wrote: »

They also came to the boom party a bit late. So context is needed.

That's not true. Looking back at the data, which I posted in the past somewhere, NI had a housing boom - i.e high single digit or double digit annual growth figures - from 1996 to 2007.
NI had a boom for two reasons
1. Loose lending practices by banks allowing large income multiples and 100% loans.
2. A buy-to-let frenzy. Some of this was from the ROI where euro mortgages were at rates below inflation. Locals also got into the game when you could get a reasonable return, plus with the year-on-year growth in house prices that I alluded to above, you got a capital return.
Many of the less affluent got in on it after 2003. You couldn't walk down the street without someone boasting about how much their BTL was no worth. BTL was the thing to do.
The media talked about it alot in 2006 and onwards but it was an old story by then. The boom was a decade old. They just hadn't reported on it as much.