North's House Prices Now 'Down By Half'

Home prices in Northern Ireland are still falling, according to the latest survey by the Royal Institution of Chartered Surveyors (RICS) and Ulster Bank.

RICS housing spokesman Tom McClelland said keenly priced new-build homes and repossessed properties priced at 2003/2004 levels were selling, but that re-sales of existing properties were limited.

Mr McClelland said prices were down by about 50%, making homes more affordable.

But the study predicts that the number of property sales should rise during the next three months.

The local news in NI came as there was evidence of further widening between regions in the UK's housing market.

The RICS said this became increasingly noticeable during February, led by an improvement in London, while large parts of the North, East and Midlands continued to experience a more downbeat picture.

The latest RICS UK Housing Market survey has shown that London was the only region to record a positive reading for house prices last month, with 14% more chartered surveyors reporting prices rose rather than fell.

This is in direct contrast to the national picture where 26% more saw prices fall rather than rise.

However, although negative, the headline net price balance has now improved for four months in succession and stands at its best level since July last year. Significantly, 12% of respondents, nationally, reported rising prices in February compared with 7% in January; this is the highest proportion since June last year.

Elsewhere, the East of England, East Midlands and Wales experienced particularly negative readings, suggesting a more downbeat picture in those regions.

Surveyors continue to report a lack of buyer confidence is affecting the market.

But overall demand for property remains at historically low levels, with a net balance of -1% reporting falls in demand. Buyer interest continues to be affected by high deposits required by lenders and fears over rising interest rates.

Despite this, some areas of the UK saw demand grow during February.

In Scotland new buyer enquiries rose sharply to +31% while London and the North East also saw increases in demand (+29% and +13% respectively).

However, highlighting the wide regional variation, the West Midlands, North West and Yorkshire and Humberside recorded negative forecasts for future sales.

(BMcC/GK)