Media articles NORTHERN IRELAND Hpc Related

[BelfastVI]

The FTB numbers have been falling right? Both as a % and and in £ terms.

FTBers made up to 70% of the market in 2001. This fell to around 30% in 2007. It has been increasing and is back to above 60% (and 70% in CML reporting in 2012).

Yes as the price of all houses fell.

[2buyornot2buy]

FTBers made up to 70% of the market in 2001. This fell to around 30% in 2007. It has been increasing and is back to above 60% (and 70% in CML reporting in 2012).

Yes as the price of all houses fell.

And what's been happening to the numbers in the last 12 months?

Puts the number in perspective,

FTB IN 2001 = 18,300

FTB IN 2012 = 5,100

So only 28% of the 2001 figure.

Edited July 25, 2013 by 2buyornot2buy

[little fish]

And this from the Mortgage Finance Gazette;

http://www.mortgagefinancegazette.com/mortgages-and-housing/lending-data-for-10000-postcodes-to-be-published/

[2buyornot2buy]

And this from the Mortgage Finance Gazette;

http://www.mortgagefinancegazette.com/mortgages-and-housing/lending-data-for-10000-postcodes-to-be-published/

Funny they can force the banks to provide this info but not provide data on sold houses through the Land Registry.

So the banks will tell us who borrow x and what for but we can't access data they already record on the LR in every other part of the UK.

[BelfastVI]

The FTB numbers have been falling right? Both as a % and and in £ terms.

As we all know since the crash sales of housed dropped dramatically.

First Time Buyers have been rising as a percentage of purchasers during that time. I think that is a good thing.

[2buyornot2buy]

As we all know since the crash sales of housed dropped dramatically.

First Time Buyers have been rising as a percentage of purchasers during that time. I think that is a good thing.

So do I. Provided they've saved their own deposit and not used silly schemes like coownership or momentum. Or had to borrow from BOMAD in what someone on the main board called a financial circle jerk.

[Shotoflight]

Sorry I will rephrase

In your view what is the factually accurate 'figure' representative of NI average house price.

For the avoidance of doubt, and for the last time, my confidence rests in the RPPI as the most comprehensive whole of market, trustworthy, accurate report of house sales and, as a consequence, prices in NI.

How many houses are sold bypassing EA's other than "Hotel based auctions" (spit) - between family members for example that will never be cought in their sample/survey? Could it be 4 or 5%. I know of several.

Now if it doesn't suit your needs in terms of comparison with other regional or national reports, if you are unhappy it includes repos or "Hotel based auctions" (spit), or if you would like it to include other criteria or exclude some, or identify which houses sold need money spent on them & how much - then they are issues you will just have to deal with, or take forward.

Perhaps co-ownership should be excluded (but I wouldn't suggest this) as these are sales with explicit Govt financial support or perhaps work could be done about stamp duty depressing prices at certain bands (again, I'm not fussed). So if cost was no problem, it could be all things to all people. For the time being, however, it is top dog for NI house sales and therefore prices.

The reason auction sales are included is because currently they make up a substantial proportion (increasing) of all sales and I have asked RPPI if they could disaggregate this - for the purposes of clarity, not that I believe they should be excluded. Their data only starts in 2005 also, but I can live with that.

Now we can dance around on a pinhead about averages and the skewed effects HB has as an incentive for BTL and for people to rent rather than sell, the impact of 300 yr low interest rates allowing people to hold onto houses that that historically they would have to put on the market and the forbearance of banks, NAMA and the courts further impacting on full market disclosure of prices but these are inputs and causes rather than output and effect.

Only my opinion of course so I wouldn't get too exercised about it. Any other issues could be taken up with the authors - they'll get paid to defend it .

Edited July 27, 2013 by Shotoflight

[little fish]

While the RPPI may not be the ideal tool for all, it is an enormous improvement on what we have had previously (I remember a house sale which couldn't complete on time as the property had not even been noted with LR some 18 months after previous purchase). As with most subjects taking a wide perspective by reading all the reports available will deliver a better understanding of the market. Personally I consider the RPPI the most comprehensive, however I would still ask about, local shops, neighbours etc for 'gossip' about a property before purchasing.

[BelfastVI]

For the avoidance of doubt, and for the last time, my confidence rests in the RPPI as the most comprehensive whole of market, trustworthy, accurate report of house sales and, as a consequence, prices in NI.

How many houses are sold bypassing EA's other than "Hotel based auctions" (spit) - between family members for example that will never be cought in their sample/survey? Could it be 4 or 5%. I know of several.

Now if it doesn't suit your needs in terms of comparison with other regional or national reports, if you are unhappy it includes repos or "Hotel based auctions" (spit), or if you would like it to include other criteria or exclude some, or identify which houses sold need money spent on them & how much - then they are issues you will just have to deal with, or take forward.

Perhaps co-ownership should be excluded (but I wouldn't suggest this) as these are sales with explicit Govt financial support or perhaps work could be done about stamp duty depressing prices at certain bands (again, I'm not fussed). So if cost was no problem, it could be all things to all people. For the time being, however, it is top dog for NI house sales and therefore prices.

The reason auction sales are included is because currently they make up a substantial proportion (increasing) of all sales and I have asked RPPI if they could disaggregate this - for the purposes of clarity, not that I believe they should be excluded. Their data only starts in 2005 also, but I can live with that.

Now we can dance around on a pinhead about averages and the skewed effects HB has as an incentive for BTL and for people to rent rather than sell, the impact of 300 yr low interest rates allowing people to hold onto houses that that historically they would have to put on the market and the forbearance of banks, NAMA and the courts further impacting on full market disclosure of prices but these are inputs and causes rather than output and effect.

Only my opinion of course so I wouldn't get too exercised about it. Any other issues could be taken up with the authors - they'll get paid to defend it .

Thanks for this. I was asking for a 'figure' or price for the current average.

[Shotoflight]

If a thousand million is a billion, then HB(NI) = £1 billion dished out every 4 yrs to "sustain" the private rented sector via private tenants (ie landlords) indeed, a key concern of welfare reform was the impact on landlords' and lenders' business models!!!!!!!!!!. Then we have rates relief including preferential landlords discounts (current hot topic), co-ownership, improvement grants etc.

http://www.nihe.gov.uk/housing_research_bulletin_issue_15_spring_2013.pdf

Welfare Reform

Housing Benefit (HB) has played a key role in sustaining the private rented sector in Northern Ireland, where in 2011/12 approximately 60,000 private tenants were supported by HB to the value of more than £250 million. It also supports the housing costs of a sizeable proportion of social sector tenants: around three quarters of Housing Executive tenants are generally in receipt of some assistance through HB.

For both landlords and lenders, the capacity to retain direct payment of rent provides an important assurance about income streams: the potential for increased rent arrears and the associated impact on business models has been one of the key concerns about the reforms in other parts of the UK.

Co-Ownership

Northern Ireland’s do-it-yourself shared ownership scheme has enabled more than 22,000 households to purchase their own homes since it was established in 1978. Almost 600 of these properties were purchased during 2011/12, at an average price of £117,675. In total, nearly 16,900 households have ‘staircased’ out of the scheme to become full owners, although there were only

159 full staircasers during 2011/12, reflecting difficulties experienced by some households who have struggled to maintain home ownership in recent years.

Following on from a previous, three- year arrangement, Co-Ownership announced in November 2012 that it had secured a £50 million financing deal with Bank of Ireland and Barclay’s. Along with government grants totalling £100 million (*since increased by £18 million*) over the four years from April 2011/12, the private finance should help secure 2,500 affordable homes and bring the total number of households assisted through the scheme to 25,000 by 2018

[Shotoflight]

Thanks for this. I was asking for a 'figure' or price for the current average.

£94,311 as of Q1 2013 (based on sales from the HMRC stamp duty land tax and NI Valuation List dataset)

What's your figure, and why?

The claims

http://www.nisra.gov.uk/housepriceindex/LPSHousePriceIndexMethodologyFinal.pdf

Exploratory discussions took place with University of Ulster, Northern Ireland Housing Executive (NIHE) and Propertynews.com to advise of LPS intention to produce what LPS term as “the definitive house price index” for Northern Ireland.

The National Statistician’s review of House Price Statistics which was published in December 2010 recommended the production of a reliable mix-adjusted House Price Index for Northern Ireland based on actual sale prices. There is currently no other reliable HPI based on actual sales evidence available within the province.

The proposed hedonic modelling approach uses Multiple Regression Analysis (MRA) to produce a multiplicative model that calcul

ates average values for each property type. It ensures that although the actual properties sold may be skewed in favour of one property type or a certain property characteristic, the value of a “standardised” house can still be calculated. The hedonic methodology does an excellent job of controlling for variations in the quality of residential property.

The method’s main strength is that it can be used to estimate values based on actual choices. Property records are typically reliable as they are collected for financial purposes. The hedonic modelling approach also allows many different characteristics to be considered and included in the analysis if it is found that they significantly contribute to house prices.

The main drawback of this approach is that it is data intensive.

Edited July 28, 2013 by Shotoflight

[BelfastVI]

£94,311 as of Q1 2013 (based on sales from the HMRC stamp duty land tax and NI Valuation List dataset)

What's your figure, and why?

The NI RPPI had three figures. £94k is the middle price and thats fine.

We now have a range of 'Average' figures indicating the market in NI and it can be quite confusing.

One of the NI RPPI figures is: £94k

Nationwide (part market share): £108k

Halifax:(part market share): £106k

CML (80% of sales via Mortgage)

UUJ/BoI £131k

ONS £134k

Official House Price Statistics Explained (ONS)

Differences between other official statistics and ONS HPI: Northern Ireland Residential Property Price Index (NI RPPI)

The LPS dataset holds information on all sales; this covers owner occupiers buying with a mortgage or a remortgage and cash purchases. LPS includes buy‐to‐let sales, which, together with remortgages, are removed from the ONS dataset. Another reason why the LPS dataset is larger than the ONS dataset is because it includes information from mortgage lenders whose activities are limited to Northern Ireland and cash sales. However, LPS does not identify or account for cash sales in their model so their impact is difficult to assess. It is likely that these differences, especially the inclusion of cash sales and re-mortgages, go part of the way to explaining why Northern Ireland prices are lower in the LPS dataset than in the ONS dataset.

Once the estimated prices have been produced by their respective hedonic regression models, LPS and ONS use different methods to aggregate together these estimated prices. ONS relies on an arithmetic average, while LPS uses a geometric average. Given the same values, geometric averages will be lower, leading to a lower estimate of average price compared to the ONS price. For their weights, LPS uses the proportions of each model characteristic from the transactions within the last year to build an ‘average property’ for which a price is estimated by applying the parameters from the hedonic regression model. ONS takes a slightly different approach by estimating prices for all the different property combinations and applying weights based on the transactions of the three previous years to aggregate them into average properties. Both approaches are in practice very similar, with the main differences being the period of the weights (one or three years) and the aggregation method (arithmetic or geometric). These differences in aggregation formula are known to produce a significant difference between average house prices, with the NI RPPI average house price being lower than the ONS average.

The differences between the LPS and ONS approaches can lead to significantly different estimates of house prices, for example with significant differences in the average price of a purchased property. The differences in average prices can be found to be a sum of differences in the source data, the characteristics included in the models, the weighting applied to the prices or parameters and the aggregation formulae. The use of arithmetic aggregation formulae in the ONS HPI and geometric aggregation in the NI RPPI would cause a persistent difference in average house prices, even if the same data sets and models were used. Currently there is no established view on which is better to use when compiling a house price index.

There is alot in the report that is positive about the NI RPPI, but the figure they produce will not be comparable with others and even if ONS was to use the exact same data set the average produced by NIRPPI, because of their modelling, would be lower.

There always hase been a difference between the various figures, even in the Uk. Averages there can range from £165k to £230k.

The important thing is to not be comparing apples to oranges.

[Shotoflight]

Halifax estimates

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/10208567/Number-of-first-time-buyers-highest-since-2007.html

In London, where house prices have seen a substantial rise, 97pc of people taking their first step on the housing ladder had to pay stamp duty this year, while the South East had the second biggest proportion at 85pc.

Northern Ireland, which has suffered an economic downturn and a consequent decline in house prices, had the lowest number of first-time buyers paying stamp duty, at just 13pc.

[2buyornot2buy]

So 87% of FTBs are buying property under 125k?

[Shotoflight]

Nolan 17 July. ONS sayy prices up 1.9%. EA calls bottom & selling twice as many houses as previous 12 months.. JD sees 3 yrs of price rises.

http://jonathandaviswm.com/jonathan-davis-media/618/

[2buyornot2buy]

3 years of rises then what?

[BelfastVI]

Well I am still seeing price drops and no VI will get me buying before the time is right

JD has a VI but not in the direction you might think.

[BelfastVI]

3 years of rises then what?

I wouldn't get too excited about JD's powers of prediction. He has been wrong from 2004 to 2007, and even then was only right for NI, which was 2% of the UK market.

Dont get me wrong, I agreed with his logic and wished he had of been right. Alot less pain for everyone if in 2004 or 2005 he had of been right. But he was not and prices, instead of falling increased by 100's of percent.

Was he now predicting 3 years of rises in NI?

[Shotoflight]

Not NI specific - stolen from Ramseconomics.

The Cult of Home Ownership Is Dangerous and Damaging

http://www.iie.com/publications/opeds/oped.cfm?ResearchID=2446#.UfbU-NeJBSg.twitter

The real issue, however, is the harm done by efforts in the United Kingdom and United States to maintain and increase that rate. Start with the distortion to savings behavior that mortgage subsidies and high loan-to-value ratios encourage. For many American and British households, their home equity is their primary financial asset. In other words, we incentivize middle-class households to leverage the bulk of their savings into a highly volatile, difficult to price asset, which is subject to disaster risk both idiosyncratic (fire, tree falling on the roof) and general (flood, local industry closure), and which—based on the economic fundamentals—should return at best the average rate of local wage and population growth.

Average individuals cannot calculate, let alone reasonably project, the running costs and financial risks of their housing investment as opposed to renting and putting their savings in more stable, liquid assets. But they constantly hear the misleading mantra that renting "is throwing money away" while incurring mortgage debt "builds equity." So their savings go into housing, which puts them to little productive purpose as compared to investing in new businesses, infrastructure, or research and development—or, for that matter, compared to rental housing that provides the same services but costs less (when individuals are not paying for the option on artificial capital gains that goes with ownership). Overinvesting in bricks and mortar is a losing proposition for the households involved—but also for the economy as a whole.

The costs of excessive home ownership, however, go even further. The promotion of such ownership is fundamentally regressive. It perpetuates inherited wealth and subsidies of middle-class children. The accumulation of housing wealth benefits those simply lucky enough to have had grandparents who were homeowners. Any policies to promote younger people "getting on the property ladder" will disproportionately benefit those fortunate children who have been given savings, have parental co-signers, and can show stable prior residency. They come at the cost of spending that money elsewhere, say on housing credits for the poor. They also perpetuate an influential lobby to protect mortgage debt and housing assets from taxes, whether while living in the asset or passing it on to family members. Like all favoritism to the children of the relatively rich, this discourages the development of new talent and competition, and thus is economically harmful.

[BelfastVI]

Latest Northern Ireland Housing Bulletin published

Stormont press releases

Belfast Telegraph: 13 June 2013

The Northern Ireland Housing Bulletin, for the period October to December 2012, was published by the Department for Social Development today

• The total number of new dwelling starts was 1,403, an increase of 49% on the same period in 2011.
  
• The total number of new dwelling completions was 2,394, an increase of 64% on the same period in 2011.
  
• In the first quarter of 2013 the Northern Ireland Residential Property Price Index stands at 87. Between Quarter 4 (October - December) 2012 and Quarter 1 (January - March) 2013 residential property prices fell by 1%.
  
• For the first quarter of 2013, the standardised residential property price is 6% lower than the same quarter in 2012
  

My link

[Shotoflight]

NI led the way in this, back in the day! Oh the nostalgia of sleeping bags on the Ormeau Road, reminiscent of the January sales.

You can have a say in the fixtures and fittings!!!!!!!!!!!!!!!!!

What are the risks of buying a home off-plan?

http://www.bbc.co.uk/news/business-23547988

Would you buy a house or a flat without actually seeing it first? Thousands of people looking for a new home are now buying off-plan, a trend last seen at the height of the property boom before 2007.

Many developers say half the new homes they are selling are now off-plan. Buyers agree the price, typically pay a 10% deposit, and then have to wait up to a year until the home is finished.

It does offer buyers the opportunity to chose their own fixtures and fittings.

And, if prices are rising, the chances are their home will have already proved a good investment by the time they move in. But equally well, things can go badly wrong. If they do, buyers could end up losing a deposit of tens of thousands of pounds, and even being sued by the developer.

Buying off-plan is not for the faint-hearted. If prices go down, they will have lost money before they even get through the front door.

And things can get even worse than that.

If property values start falling, the bank or building society may change its mind about lending you as much as they promised when you took out the deposit. You or your partner may lose your job, and again the lender may get cold feet.

But the developer could still hold you to the contract you signed. If it can only re-sell the property for a lower price, it could sue you for the difference. And you will certainly lose your deposit.

Kate Faulkner, of the independent advice site Propertychecklists.co.uk, warns you could lose hundreds of thousands of pounds.

"You not only lose your deposit, but the developer can sue you for the loss in value as well, so you can lose a lot of money, and have the stress of a legal case," she says.

Then there are the other irritations of getting a home you did not quite expect. Perhaps the view is obscured. Perhaps the plumber has had a bad day, and plumbed the hot supply to the cold tap.

Edited August 3, 2013 by Shotoflight

[Shotoflight]

Home truth is your house may not be much of a pension

http://www.independent.co.uk/money/spend-save/julian-knight-home-truth-is-your-house-may-not-be-much-of-a-pension-8744655.html

The UK property market in many parts of the country has been propped up by action to stave off mass repossessions and tight mortgage lending.

This has meant that prices have remained nominally high but only because there were next to no transactions.

The upshot of all this is that if you are one of those people who thinks my property is my pension then you should think again, because in many cases it will disappoint.

[BelfastVI]

Home truth is your house may not be much of a pension

http://www.independent.co.uk/money/spend-save/julian-knight-home-truth-is-your-house-may-not-be-much-of-a-pension-8744655.html

The UK property market in many parts of the country has been propped up by action to stave off mass repossessions and tight mortgage lending.

This has meant that prices have remained nominally high but only because there were next to no transactions.

The upshot of all this is that if you are one of those people who thinks my property is my pension then you should think again, because in many cases it will disappoint.

This is the NI Form and this article is specifically related to the areas of the UK that have not had a correction are are not being helped by the 'Help to Buy' Government scheme. I actually share those same concerns.

However NO has had a 50% price correction and now is reported to boast itself as one of the most affordable regions in the UK. (it has typically been posted mid table over the years).

Help to Buy is not in Northern Ireland and the UK Gov has not assisted in propping up prices here.

[2buyornot2buy]

Help to Buy is not in Northern Ireland and the UK Gov has not assisted in propping up prices here.

Coownership? I believe the government have said it's a market prop.

[Shotoflight]

This is the NI Form and this article is specifically related to the areas of the UK that have not had a correction are are not being helped by the 'Help to Buy' Government scheme. I actually share those same concerns.

However NO has had a 50% price correction and now is reported to boast itself as one of the most affordable regions in the UK. (it has typically been posted mid table over the years).

Help to Buy is not in Northern Ireland and the UK Gov has not assisted in propping up prices here.

So no one in NI thinks their house or BTL portfolio is their pension?

Where do you start on Govt intervention - from interest rates to encouraging banks to lend, encouraging forbearance and pleading for no nama firesale, increasing co ownership by 50%, dithering over welfare cuts, no water charges, rates stop at £400k

not sure what help to buy has or hasn't got to do with it., the article suggests it will help values and as you correctly state it won't be coming here