While house prices across the UK have largely remained on a downward spiral for the past six months due to increasing affordability pressures, property values in Northern Ireland have been bucking the trend.
According to data from HM Land Registry, average house prices in the 12 months to August remained little changed in England to £310,000 (0.0 percent) and decreased in Wales to £217,000 by 0.1 percent. Scotland saw a marginal increase of 1.1 percent to £194,000.
Meanwhile, house prices in Northern Ireland experienced the highest growth rate of 2.7 percent.
As per Halifax’s latest house price index, prices dropped across all regions in the UK over the past year.
But while South East England reportedly grappled with price drops as significant as six percent in the 12 months to October, Northern Ireland saw a more modest decline of 0.5 percent.
Richard Ramsey, chief economist of Ulster Bank in Northern Ireland told the Telegraph: “Increased rental prices amid an acute housing shortage in Dublin has led to a rise in interest in Northern Irish property.
“Working from home has enabled workers in Northern Ireland to access cheaper accommodation in the North relative to the South. Private sector rents have hit ridiculous levels in Dublin.”
He added that people can commute from areas such as Newry in Northern Ireland to Dublin in the Republic of Ireland in just an hour by train.
According to Tabitha Cumming, a property expert from The Lease Extension Company, the region’s “dwindling supply of houses” is greatly impacting the upward trend.
Ms Cumming told Express.co.uk: “Prices are rising much faster than everywhere else in Northern Ireland, with the market seeing an annual rise of almost three percent this year, compared to other regions where there has only been around a one percent increase.
“Even though the property market in the area is under the same pressures from the interest rises set by the Bank Of England and rising inflation, it is a dwindling supply of houses that is driving up prices.
“As there are not as many properties for sale, this is causing prices to rise. Some potential sellers are waiting until the market has calmed down before they list their homes on the market.”
Echoing the sentiment, Mr Ramsay said many large housebuilders in Northern Ireland went out of business following the last property downturn, resulting in a “notable slowdown” of house building in the last year.
John Carrigan, director at property developer Fraser Millar, told the Belfast Telegraph that a lack of infrastructure from NI Water and challenges of “catching up’’ with production after coronavirus lockdown breaks have played a part in preventing the implementation of more newbuilds.
Mr Carrigan said: “Many housing development sites have approval, but can’t actually be built because they can’t connect to the sewer network. We need to streamline our planning services to actually get a housing development approved to get into building it.”
A spokesperson for NI Water said that the utility “has been warning for some time that underinvestment in wastewater services is creating pressure on the wastewater system and has resulted in us not being able to support planning applications and new connections in certain areas”.
Additionally, Ms Cumming pointed out: “The average number of days that it takes for houses that are on the market to be sold is also increasing.”
However, she noted some experts predict that market pressures may ease in the coming months, which could potentially see prices dropping again in 2024.