Demand for housing keeping rental inflation elevated in the north, studies show

While house price inflation is easing, the average rent was 10.2% up year-on-year in April

Row of red brick townhouses on a leafy street.
The latest house price index from Ulster University has reported that rental market pressures remain at highly elevated levels in the north.

Rental inflation continued to climb in the north last month, driven by demand, new analysis of the housing market suggests.

The average rent in Northern Ireland during April was 10.2% higher than 12 months earlier, according to PropertyPal.

The listing website said while house price inflation eased steadily over the past year, falling to 2.9% In April, the rental price tracker is continuing on an upward trajectory.

A separate housing market study published on Monday from Ulster University (UU) reported that rental market pressures remain at highly elevated levels.

One estate agent who took part in the university survey said that demand, as measured by enquiries sent in for listed properties, was approximately 30% higher than last year.

Another noted: “We continue to see extremely high level of demand for rental properties, particularly from those who cannot access to owner occupier sector due to affordability.”

The pace of new house building is also adding pressure.

Just 5,379 new dwellings were completed in the north during 2023, the lowest annual figure since 1959.

The survey was published as part of the quarterly house price index produced by Ulster University, alongside the Housing Executive and the Progressive Building Society.

The index put that average price of a home in Northern Ireland at £206,754 in the first quarter of 2024, representing a 0.6% drop from the final quarter of 2024.

However, when measured by a weighted index to reflect the market share of each property type, the UU study estimates the average price of a home actually increased by 2.4%.

It’s one of a number of house price indices which track the property market in the north, using slightly different methodologies.

Last week, the Halifax index estimated the average house price in Northern Ireland was £192,502 in April, 3.4% higher than 12 months earlier.

The official house price index for the first quarter of 2024, compiled by Land and Property Services (LPS), is due to be published next week.

The last LPS survey put the average house price at £177,611 in the final quarter of last year.