Business

Covid-19: NI housing market suffered more in last quarter than aftermath of 2008 financial crisis

Just 2,270 residential property transactions took place between April and June 2020, lower than any quarter in the wake of the housing crisis.
Ryan McAleer

THE north’s housing market suffered more in the past three months than any quarter during the height of the 2008 financial crisis, new HMRC data shows.

The Covid-19 lockdown meant just 2,270 residential property transactions took place between April and June, down 66 per cent on the same quarter in 2019.

Crucially the figure marks a new low point in the modern data series recorded by HMRC.

From a high point of 13,720 houses sold in the fourth quarter of 2006, the credit crunch of 2007 and 2008 saw home sales in Northern Ireland plunge to just 2,570 in the first quarter of 2009.

That quarter had remained the historic low point, until now.

The introduction of restrictions in the wake of the coronavirus pandemic resulted in just 410 sales in April and 540 in March, now the two worst months on record.

The reopening of the housing market in June helped residential property sales recover to around 1,320.

Non-residential property sales also hit a historic low in the last three months. HMRC’s figures show just 410 sales over the quarter, again lower than any of the worst performing quarters seen after the last financial crisis.

The 34 per cent decline on the same quarter in 2019 was less pronounced than the drop in home sales.

Non-residential property sales hit a low of 100 during May, but returned to 180 in June.

Jordan Buchanan, chief economist at PropertyPal said Covid-19 had a profound and immediate impact on the economy and the property market in particular, hitting a traditionally popular time to buy.

But he said the 1,300 homes sold last month reflected a gradual rebound in confidence

Looking ahead to the rest of the year, he said: “The summer months are likely to see continued strength in transaction levels as many aspiring buyers complete on deals agreed pre-lockdown and new entrants to the market look to move, having re-assessed their housing needs.

“Later this year the outlook is much more uncertain and is dependent on the extent of the economic recovery and the availability of mortgage finance, particularly for first time buyers with lower deposits.”

Enjoy reading the Irish News?

Subscribe now to get full access