Buying a house

[FermGael]

Yay, interest rate held at 0.5% by the Bank of England.

They can only do this for so long.  About another 6-12 months iMO.

get yourself onto a good fixed rate soon Rois

[Rois]

I would think about it if I could, but am a typical example of an idiot, bought at the peak with no deposit.  Need to pay off a good bit more capital before I get anything decent.  Loan to value will be ridiculous.

[orangeman]

House prices 'start to recover' 

Prices are still far below their peak in 2007
House prices in Northern Ireland have risen for the first time in two years according to the latest Nationwide building society figures.

It said prices were up by 9.7% over the last three months, however they are still down 8% on this time last year and down 35% from their peak in 2007.

The study puts the average house price in NI at £147,204.

Nationwide said the softening in the year-on-year rate of price decline may indicate improving affordability.

"The ratio of house prices to earnings is now broadly in line with that for the UK as a whole, having been well above the UK average for most of the last two years," said the Nationwide's chief economist Martin Gahbauer.

Mr Gahbauer suggested that any recovery is not being spread equally across Northern Ireland.

Unemployment

"The Northern Ireland (West) sub-region saw the largest annual fall in house price this quarter and has also been the worst performing area over the last two years," he said.

  The more fundamental reason why prices might start falling again is that, by most measures, they are still significantly over-valued

Stephanie Flanders, BBC economics editor


Read Stephanie's blog in full 
"Elevated levels of unemployment in parts of the area are likely to have had a negative impact on prices."

The Nationwide figures are produced from Nationwide mortgage data. The data is extracted monthly for mortgages that are at the approvals stage.

This is the second report in recent months to suggest that the Northern Ireland housing market is showing tentative signs of recovery.

A University of Ulster/ Bank of Ireland survey in August showed that house sales were increasing with prices moving up slightly.

[StGallsGAA]

The recovery across the water has started alright however up until the crash they had normal growth in a bouyant market of approx 10% per year.

The big problem here was the market was overheated with between 25%-40% growth for several years running.   The last 16 months of the boom from Jan 2006 & up to spring 2007 saw 50% growth in some areas meaning properties were ridiculously overpriced due to investors. 

Provided sellers realise that realistically values are now at 50% or below of early 2007 prices then things will start to move a little.  Problem is too many sellers don't want to face up to that fact.

[bailestil]

Don't get the whole rising house prices = good for the economy.

Since when does rising cost of living become good for an economy?

Increased house prices only gives the illusion of wealth.
As has been said about the south. We thought we could get rich selling each other houses.

seems like that mentality is still the same here in the north.

[Main Street]

It is the illusion of a recovery, the bubble being refilled with air.

[tyronefan]

its not about the prices rising, its more about them not falling any lower and the prices stabilizing. They should rise with inflation at a moderate rate per year.

The reason this is a good thing is people will start buying again, developers will start building again and  employing trades men again, who will start to spend the money they are earning again.

The most of the unemployed people have come from the construction trade.

The money starts circulating and the economy starts to function again.

[orangeman]

I just read the Property section of the Independent there and prices in the south are still very high. Apartments are still around € 200k. Houses are € 250k upwards - that's a lot of money and if you have a 100% mortgage, it's a lot of paying back.


The price pf a house should be based on the land cost and the costs involved in planning, developing and building copuled with the amount that households can afford to repay in mortgage costs. For some time now, these factors have been ignored - it was just a question of how much you could get for it as far the developers were concerned.

The sooner it returns to this the better.

[under the bar]

The reason this is a good thing is people will start buying again, developers will start building again and  employing trades men again, who will start to spend the money they are earning again.

However until banks start lending to the first time buyers without asking for ridiculous deposits of 20% and more none of the above can start happening.

[Main Street]

20% is not a ridiculous deposit.
What is ridiculous is what the 20% equates to in money terms in relation to salary.

[bailestil]

its not about the prices rising, its more about them not falling any lower and the prices stabilizing. They should rise with inflation at a moderate rate per year.

The reason this is a good thing is people will start buying again, developers will start building again and  employing trades men again, who will start to spend the money they are earning again.

The most of the unemployed people have come from the construction trade.

The money starts circulating and the economy starts to function again.

So the average house price in NI is £150,000 or so.

So an average family with 1 person working would need to be earning £45,000 or so per annum to buy an "average" house. Thats using the age old 3.5 times your salary as a calculation.

I would be amazed if the average wage in NI was over £22k or so.

In Derry the average house wage is whatever the DLA pays, yet the a average house would still cost £150,000 or thereabouts.

i'd say mainstreet is correct, this thing is getting inflated again, no thanks to belfast telegraph and co (who happen to open propertynews.com and earn plenty from all those property supplements)

[tyronefan]

The banks are still reluctant to lend and are requiring large deposits because they are not sure if the bottom of the market has been reached here yet and they are covering themselves in case of any further falls.

Mortgage lending has gone up 83% in the UK because it is believed that the bottom of the market has been reached there

[Cúig huaire]

The bottom of the market has probably been reached in the UK, with NI now also showing signs of growth. The market in the south still has some way to go and is unlikely to start to recover until 2011.

[bailestil]

The bottom of the market has probably been reached in the UK, with NI now also showing signs of growth. The market in the south still has some way to go and is unlikely to start to recover until 2011.

I can understand a recovery in England.
However why in NI?

Could anyone explain to me how anyone can justify the price of a house in N.Ireland versus the wages in N.Ireland. It doesn't add up.

[Cúig huaire]

Have house prices in NI not returned to a more "normal" level?