Northern Ireland Residential Property Price Index

dsab

30% sounds probably about right.

I bought my House (new built) a little bit less then 4 years ago, and had to call the Bank a few days ago as my current deal is ending soon.

According to their Computer Valuation the Value of the house has risen by 26% since I bought it. Looking around the Area at prices of other existing stock, and of new builds I might even be able to get slightly more then the Valuation they currently hold.

qwert_yuiop

So we're back around rateable value levels, which were 2005 prices, with pounds which were worth £1.25 in 2015. Ten years - how was it for you? Remember the good old days when you couldn't go wrong with property, supposedly.

motorguy

qwert_yuiop wrote: »

So we're back around rateable value levels, which were 2005 prices, with pounds which were worth £1.25 in 2015. Ten years - how was it for you? Remember the good old days when you couldn't go wrong with property, supposedly.

And if you'd owned a house from then, through the crash, and just kept chipping away at your mortgage month in month out, you'd be no worse off.


Too many people see their house as source of profit. Its a home. Its worth what its worth when you buy it, and its worth what its worth when you're ready to move on.

qwert_yuiop

Well indeed. An unproductive asset.

It's only anecdotal, of course, but I suspect farmland has got a little cheaper recently, which probably makes sense with all the recent upsets and doubt about our export trade.

marathonic

qwert_yuiop wrote: »

So we're back around rateable value levels, which were 2005 prices, with pounds which were worth £1.25 in 2015. Ten years - how was it for you? Remember the good old days when you couldn't go wrong with property, supposedly.

If you're going to look at it as £1.25 for £1, one should consider themselves lucky to have borrowed 'a pound worth £1.25', and now only have to pay back £1.

The proper way to look at it would be the way I looked at it in the post below from 3 years ago.

Basically, the difference back then was that buying saved me over £100 per month and I had the security of knowing that I wasn't going to be thrown out of my house at a landlords whim.

The difference today is that the rent for an equivalent property recently let on my estate was £100 more expensive and my mortgage rate is 1.54% as opposed to 2.9% - saving £130 per month on the theoretical 100% mortgage interest.

In other words, three years ago, buying saved me £100 per month and that has increased over those years to a saving of £330 per month whilst, at the same time, my property has rose by about £45,000 in value. A poor investment in your eyes?

marathonic wrote: »

I've been playing with some figures for my own circumstances having bought in December 2012.

Cost of Ownership
Mortgage Interest: 3,335
Maintenance Estimate: 1,250
Rates: 1,200
Insurance: 120
Total Ownership Cost: 5,905

Saved Rent: 7,200

Savings in buying as opposed to renting: 1,295

The interest figure above assumes I got a 100% mortgage, which I didn't, but is the figure that should be used for a true comparison considering the opportunity cost of losing my deposit.

Now onto price movements:

Property Type: Detached House in North of Northern Ireland @ £115,000.

Annual Change as per Q3 2013 Report:
North of Northern Ireland: +5%
Detached: +3%

Using a 4% estimate, my property has rose by £4,600. Add the savings when compared to renting to that and I come up with £5,895.

This is without looking at the fact that I negotiated a good discount, due to it being a falling market, and the banks valuation coming in higher than the price I paid.

It also ignores the fact that I bought at the end of Q4 2012, a quarter that declined by 2%. Therefore, the quoted 4% rise incorporates a 2% decline for which I wasn't actually in the market.

glentoran99

motorguy wrote: »

And if you'd owned a house from then, through the crash, and just kept chipping away at your mortgage month in month out, you'd be no worse off.


Too many people see their house as source of profit. Its a home. Its worth what its worth when you buy it, and its worth what its worth when you're ready to move on.

bought in 2006 for 139000


sold in 2016 for 74000


balance at the time 120000


but yeah no worse off

marathonic

glentoran99 wrote: »

bought in 2006 for 139000
sold in 2016 for 74000
balance at the time 120000
but yeah no worse off

That's rather unfortunate timing.

Ratio of NI Median House Sale Price to Median Annual Gross Earnings
2005 5.6
2006 6.8
2007 9.1
2008 7.2
2009 5.9
2010 5.5
2011 4.8
2012 4.2
2013 4.2
2014 4.5
2015 4.5
2016 4.7


With hindsight, it's easy to see that prices were overvalued from 2006 - 2008. However, it was different times back then and people thought you were mad if you didn't jump into the property market as soon as physically possible.

Where we go from here is anybodies guess but it looks like we're at about fair value. If the market were sensible, we'd probably chug along here with rises matching inflation but the property market is too hyped up on emotion. It wouldn't surprise me if we were to see another bubble which I'd define as a 20% rise from here. That'd send the price index from £124,093 to £148,911. It's not my base case but still a possibility - and a more likely one than a 20% fall from here.

qwert_yuiop

marathonic wrote: »

If you're going to look at it as £1.25 for £1, one should consider themselves lucky to have borrowed 'a pound worth £1.25', and now only have to pay back £1.

Those careless bankers forgot to charge any interest.


has rose

has risen. Please.


Does it really need all this mathematical analysis to justify it? We bought our place because we wanted it. It probably wasn't the greatest investment I've ever made, but then neither was this packet of cheese and onion I'm enjoying now. If you're relying on some fear of being evicted and finding yourself in a tent somewhere as your rationale for purchase, it's a fairly flimsy justification. There are various rules to prevent your landlord abusing you, and there's every chance of a mortgagee who's fallen on hard times finding themselves evicted by the bank as well.

qwert_yuiop

marathonic wrote: »

That's rather unfortunate timing.

Ratio of NI Median House Sale Price to Median Annual Gross Earnings
2005 5.6
2006 6.8
2007 9.1
2008 7.2
2009 5.9
2010 5.5
2011 4.8
2012 4.2
2013 4.2
2014 4.5
2015 4.5
2016 4.7


With hindsight, it's easy to see that prices were overvalued from 2006 - 2008. However, it was different times back then and people thought you were mad if you didn't jump into the property market as soon as physically possible.

I [/B]blame the parents. Adult children being fed outmoded propaganda about renting being dead money and all the other cliches. You can't ignore mammy's advice, can you? Yea, you can. You're thirty three. I was making more than my parents together at that age. It's why I ignored them.[/B][/B]


I'd define as a 20% rise from here. It's not my base case but still a possibility - and a more likely one than a 20% fall from here.

I'd define that as guessing.

marathonic

qwert_yuiop wrote: »

has risen. Please.


Does it really need all this mathematical analysis to justify it? We bought our place because we wanted it. It probably wasn't the greatest investment I've ever made, but then neither was this packet of cheese and onion I'm enjoying now. If you're relying on some fear of being evicted and finding yourself in a tent somewhere as your rationale for purchase, it's a fairly flimsy justification. There are various rules to prevent your landlord abusing you, and there's every chance of a mortgagee who's fallen on hard times finding themselves evicted by the bank as well.

There's no need to resort to being the grammar police when you run out of arguments.

The removal of the fear of being evicted is just an added bonus. The finances are the main factor - my savings of £330 per month today over my accommodation costs had I rented will cover 2-3 holidays per year (if that's how I choose to spend it).

In my opinion, the mathematical analysis is needed to justify a house purchase. If I wanted to buy a place because I wanted it, and without any mathematical analysis, I'd have bought my house in 2007 at £250,000 as opposed to in 2013 at £115,000.

If people in 2007 had done similar analysis, they'd have realised that renting was SIGNIFICANTLY cheaper than buying and may not have found themselves in the the predicament they've been in ever since.