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How Much Further Do You Think Prices Will Fall Nominally In Northern Ireland?

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I still think that we will see house prices fall nominally by 30% - 40% from current price levels. There is no sign yet of wage inflation to support average house prices above £100,000. And don't forget the under-shoot in prices that usually happens during a house price crash.

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Not being flippant but in your opinion what is an average house?

Its not clear what you mean, do you understand what the average house price means? Its what the indexes refer to, just an average of all sales. Its not perfect just mathematically simple.

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Its not clear what you mean, do you understand what the average house price means? Its what the indexes refer to, just an average of all sales. Its not perfect just mathematically simple.

Sounds a little condecending, hope its not.

As I am a chartered accountant, no I probably don't understand what an average is <_<

What I mean is that if people think the average house price should be £100k, what does this house look like. If I have an idea what it should be then I can work out what kind of a premium I am prepared to pay for more rooms, a bigger garden, a garage, extra reception rooms, a nice area etc, etc.

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I guess the average house in NI would be a 3 bed terrace or semi. And in my area, that sort of house is still priced over £100k, in fact, there really isn't anything for under £100K, unless you go for a flat.

I would consider myself to be on an average wage, and the bank will only lend me £80k. So, the 'average' house is still unaffordable to the average salary. Thats why I voted 20-30% more to go, because I really believe it has to happen before the economy can ever recover.

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Sounds a little condecending, hope its not.

As I am a chartered accountant, no I probably don't understand what an average is <_<

What I mean is that if people think the average house price should be £100k, what does this house look like. If I have an idea what it should be then I can work out what kind of a premium I am prepared to pay for more rooms, a bigger garden, a garage, extra reception rooms, a nice area etc, etc.

We have discussed this before and there is no answer. Not only do we not know what it may be but we dont know where it may be.

One could assume an average house, which is different to a first time buyer house, is a 3 bed semi of about 1,000 sq feet. Whilst the average sq footage of houses in NI is perhaps smaller than that, including apartments and older terris(spelling) housing. However where do you find this house for the current average of £135k. Not in BT9 and perhaps not in the nicer areas of Lisburn or bangor, Moira. It is quite difficult. The problem is, as Ride on put it it is a mathematical figure and if you read the Nationwide s methodology, there is nothing simple about it. The average as we may work it out may be say £160k but as they take averages in separate sectors and then take the average again it, at the moment results in a lower figure than the arithmetic mean. I'm sure at other times in the cycle this may work the other way. I understand why they do it but I struggle with the concept that the resulting figure is an average.

If it was a mean you would assume that 50% buy at prices higher than the average/mean figure and 50% buy lower. Its not the mean, but I would guess it is close. Rather than it representing the average cost of housing it is better for showing the movement in the market. If more people are buying houses further up the ladder, as a result of prices falls this average could actually rise even though the increase in activity in that sector was triggered by actual falls. Whilst the public love it, and we get excited about it it is not as accurate as you would think. Unless, that is it is falling. In that case it is 100% accurate.

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To be honest, I have been starting to lose faith a little, and am beginning to think that house prices will only fall further due to inflation - they are still far too expensive, but over the last 6 months I have't really seen any price falls.

But there's still no way I'd buy at the moment - I don't want to be tied into such a massive debt even if I COULD get a mortgage.

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... what is an average house?

... in the UK, about £160,000 according to Halifax and Nationwide indices.

... in Northern Ireland, about £135,000 according to the last Nationwide quarterly house price report - roughly 15% below UK house prices reflecting the fact that N.I. incomes are 15% less than the UK according to the latest Office of National Statistics report.

An actual average house does not exist. However, the 'average house price' is a good indication of affordability especially when compared to ONS average incomes. This gives the house price/ incomes ratio. See graph in my signature.

Currently the Nationwide/ONS data indicates that we have a house price/income ratio of 6.25. The scale on the right of that graph does not even go up to 6.25. So you can easily see why house prices have much further to fall.

On a personal note: I actually think of an average house as a new 3 bed semi, even though I know that the average house does not actually exist. Two new developments have been placed on the market in Cookstown this summer. A 3 bed semi is around £125,000 on these sites. They seem like bargains compared to 2007 prices. However, I check the estate agents website regularly and they are still not selling :blink:

Edited by Belfast Boy

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... in the UK, about �160,000 according to Halifax and Nationwide indices.

... in Northern Ireland, about �135,000 according to the last Nationwide quarterly house price report - roughly 15% below UK house prices reflecting the fact that N.I. incomes are 15% less than the UK according to the latest Office of National Statistics report.

An actual average house does not exist. However, the 'average house price' is a good indication of affordability especially when compared to ONS average incomes. This gives the house price/ incomes ratio. See graph in my signature.

Currently the Nationwide/ONS data indicates that we have a house price/income ratio of 6.25. The scale on the right of that graph does not even go up to 6.25. So you can easily see why house prices have much further to fall.

On a personal note: I actually think of an average house as a new 3 bed semi, even though I know that the average house does not actually exist. Two new developments have been placed on the market in Cookstown this summer. A 3 bed semi is around �125,000 on these sites. They seem like bargains compared to 2007 prices. However, I check the estate agents website regularly and they are still not selling :blink:

Thats the trouble with averages, its not only what it is it is where it is. I attach an extract from the DSD NI Housing Bulletin for the end of 2004 (pre boomish)

It shows that the average new house in Cookstown was £100k against the NI average for new houses of £125k. Therefore Cookstown should be, if that snapshot is reflective, about 20% cheaper than the NI average.

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I have looked at these figures and it shows, during the period in question that the prices of various districts varied from 40% over NI average (North Down) to 30% under the NI average (Larne) a swing of 70%, I think. This shows that the concept of an average price for an average house is just in theory.

Good news is I have found the location of this mythical Average House. It is somewhere between Carrickfergus and Ards. There may well be a song in there.

Edited by BelfastVI

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How much further do you think prices will fall nominally in Northern Ireland?

I voted 20 - 30%. Though i think it will take a bit longer than i once thought for them to reach that level, perhaps 2 or 3 years. I hope to see a 10% drop over this Autumn and Winter, hope i'm wrong, and the drop's even greater!

Friends and work colleagues (with the exception of one) all think i'm wrong, they all think that house price have hit rock bottom and that i'm a doom merchant in saying they're going to drop further. I earn roughly about the average salary, and i wouldn't get a mortgage on my first house at today's prices, they still have further to fall to reach affordable levels, i.e. 3 - 3.5 x salary.

I've an offer on a house at the minute, at RV. It's an ideal house and fits my requirements well and i can't see myself wanting to sell for a long time, if at all ever. Even though i'm sure they'll drop 20/30% over coming few years, i'd be paying less in repayments than i'm paying in rent and I'm getting itchy feet, fed up renting in less than ideal circumstances and having most of my stuff in storage. Though i'm having 2nd thoughts about the offer i've got in at the minute, and might hold off for another 6 months as i'm confident that they've got further to fall, despite what so many people are saying.

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In my eyes the average house is a semi in Orangefield in East belfast. I could be completely wrong but that's what I imagine.

Find out what it was selling for at any time in the past (pre boom) and we can check against what was the average NI price at that time.

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In my eyes the average house is a semi in Orangefield in East belfast. I could be completely wrong but that's what I imagine.

Well most average semi's in Orangefield at present are £175k so the price is still far too high.

Edited by crashbandicot

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Well most average semi's in Orangefield at present are £175k so the price is still far too high.

There are a few sale agreed that were marketed for about £10-15K less than that. That is my indicator of the average house as well, at least in Belfast. I think that they will go down to £120K eventually. They would have been priced at the peak for £300K+, although I doubt that any actually sold for that. 60% down from peak seems reasonable to me. In this sector of the market, I am guessing that actual selling prices are around £150K, so 50% down at the moment. Another 10% (of peak price) off might not seem like a lot to any bulls advising to buy now, but £30K is still a hell of a lot of money in the real world.

However for 4 bedroom detached in the (should be) £250K+ price bracket, sellers are still in fantasy land.

Edited by shipbuilder

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I have looked at these figures and it shows, during the period in question that the prices of various districts varied from 40% over NI average (North Down) to 30% under the NI average (Larne) a swing of 70%, I think. This shows that the concept of an average price for an average house is just in theory.

Good news is I have found the location of this mythical Average House. It is somewhere between Carrickfergus and Ards. There may well be a song in there.

Well I have to say I think you completely wrong, Neither Helens Bay nor Crawfordsburn could be described as average, the opposite in fact ;)

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I reckon it'll end up 50% off peak on average ... so some areas will really plummet.

Currently seems to be about 40% off peak where I am in Belfast so about 15% or so to come off current prices.

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