Despite some trepidation experienced in 2023 on the back of rising inflation and interest rates, as well as the continued political uncertainty, surveyors appear to be more optimistic about the housing market for the year ahead.
The results of the most recent Royal Institution of Chartered Surveyors (Rics) and Ulster Bank residential market survey provide much needed confidence and renewed optimism in the market for the months to follow.
Northern Ireland is still experiencing high levels of demand for residential property both locally and internationally. Due to our strategic location, we’re continuing to see buyers from RoI, GB, and beyond invest in Northern Ireland to avail of the attractive lifestyle and good value for money that our region offers compared with other neighbouring markets.
As 2023 drew to a close, we continued to experience relatively high demand for housing, with prices also rising in some cases. While there were periods during 2023 when demand eased and buyers were more cautious due to inflationary pressures, we did continue to see appropriately priced property selling well.
When we consider house pricing, although there are a number of factors at play when determining this, most of the growth has been driven by the continued lack of supply relative to demand, which we anticipate continuing into 2024.
The recent cooling of mortgage rates will be a great boost to the market and welcomed by buyers who will have previously been concerned about affordability as rates rose throughout last year.
Similarly, we’re still experiencing strong demand for rental properties with limited stock on the market across Northern Ireland. Again, while there are a number of factors at play when it comes to the growth in rental prices, including interest rates, availability remains a major driver in this regard.
With strong levels of demand for sales and lettings, there’s also further requirement for new developments within the private housing market. Alongside planning delays, the requirement for further zoning and infrastructure capacity issues, we are currently facing a significant skills gap in the built environment and a lack of labour in the market, which is having an impact on construction workloads across Northern Ireland.
There are also challenges faced by the construction market in terms of the increased cost of raw materials and supply chain challenges, resulting in delays for new projects which in turn is creating bottlenecks across the entire industry.
Overall, I am confident 2024 will be a busy year for the housing market with the outlook for the economy generally looking more promising and a recession now likely to be avoided. At the end of the day, we simply need to build more homes to support young people to find affordable, sustainable places to live and grow.
:: Garrett O’Hare is a member of the Royal Institution of Chartered Surveyors (Rics) NI regional board and managing director of Bradley NI.