Housing market ended 2020 in growth - but momentum starts to ease

The latest Rics/Ulster Bank housing report says the sector ended 2020 in growth, but there could be a softening of activity over the next three months
Gary McDonald Business Editor

HAVING weathered the series of restrictions imposed on movement last year, the latest lockdown is expected to take its toll on the north's housing market, new data shows.

The monthly Royal Institution of Chartered Surveyors (Rics) and Ulster Bank residential market report points to the sector ending 2020 in growth.

But it cautions that although the housing market remains open for business in the midst of the latest lockdown, there is a sense from respondents to the latest survey that the new restrictions will impact on transaction activity over the coming months.

This, it says, is most visible in the negative reading for sales expectations over the next three months when, with the expiry of the stamp duty holiday approaching, it would be expected to remain firmly in positive territory.

In December, most indicators remained positive, with rising activity in the Northern Ireland market and further rises in prices, though the pace of growth had softened.

Nearly half (47 per cent) of respondents said prices rose, this this was well down on the comparable figure of 76 per cent in November

Some 27 per cent or respondents reported rising new buyer enquiries in December (down from 44 per cent the previous month) while 28 per cent say a rise in newly agreed sales (it was 49 per cent in November).

Rics' regional residential property spokesman Samuel Dickey said: “While the wider economic environment is challenging, with the ongoing pandemic and restrictions, plus complications from Brexit, the housing market has continued to be busy.”

But Rics' chief executive Simon Rubinsohn said: “Looking beyond this immediate time horizon, the feedback from our members is that the uplift in prices over the past year will be sustained, for good or ill, as the macro picture gradually improves on the back of the roll-out of the Covid vaccination programme.

“More significantly, private rents are envisaged to outpace price gain as supply continues to fall short of demand with anecdotal reports of landlords exiting the market.”

Terry Robb, head of personal banking at Ulster Bank, said mortgage activity continued to be very strong, prompting the bank to reinstate 90 per cent mortgages.

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