HOUSE prices rose last month as the supply of homes became yet more scarce, according to surveyors.
The latest Residential Market Survey compiled by the Royal Institution of Chartered Surveyors (Rics) and Ulster Bank found the number of new enquiries rose for the 47th in succession.
But the supply of new homes coming onto the market reduced for the second month in a row.
Surveyors said that continued an "upward pressure on prices".
Over the course of this year, Rics anticipate house prices in the north will rise by 5 per cent.
Surveyors reported an increase in sales in January (a net balance of 8 per cent) and expect the volume of sales to rise over the three months ahead (a net balance of +30 per cent).
Rics' residential property spokesman in Northern Ireland Samuel Dickey said: “Supply remains the key issue in the market, particularly in the greater Belfast area. Demand has been increasing, and good quality homes in good areas are very much strongly sought after, leading to bidding for properties.
"The reasonably strong economic data for Northern Ireland at the beginning of this year would suggest that the conditions are there for demand to continue rising.
"However, as we move into the traditionally busy time of the year, more properties should come onto the market as well, which should help alleviate the supply issue.”
Sean Murphy, regional managing director, branch and private banking at Ulster Bank added: “The survey chimes with other economic indicators, such as the latest Ulster Bank PMI, which showed business activity rising in January.
"It also correlates with our own mortgage data which were strong in January, and which we expect to increase further as we move into the traditionally busy period for the housing market.
"Ulster Bank is committed to helping people take steps into home-ownership, to move home, and to remortgage. Our participation in the Help to Buy ISA scheme and our wide range of other mortgage products are a strong sign of that commitment.”
The most recent official figures from the Northern Ireland Property Price Index put the cost of a typical house in the north at £116,765 over the three months to September 2015 - up 7 per cent on the same period the previous year.
Looking at the UK-wide market, Rics said new buyer enquiries rose for the tenth month in succession in January, with the pace of growth in enquiries accelerating for a second consecutive report.
Feedback to the survey continued to suggest that the recent significant increase in demand is due to a rush of buy-to-let investors looking to buy before the 3 per cent stamp duty surcharge comes into effect in April.
Critically, 74 per cent of respondents expect there to be an increase of purchases by buy-to-let investors prior to the changes.
