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House prices 'below 2005 level'

An official house price index for Northern Ireland has revealed that prices are below 2005 levels.

The new Residential Property Price index is based on sale prices using stamp duty figures.

It found that prices have fallen 50% since the peak in 2007.

However, there has been a slight increase in the number of houses sold in the first quarter of this year compared to the same time last year.

In April, the Royal Institution of Chartered Surveyors said reduced household incomes and a growing number of house repossessions were to blame for the prolonged dip in the market.

In the last year, house prices have fallen 13% and have continued to fall by 7% in the first three months of this year.

The notional price of the average property in Northern Ireland is now £98,467.

Sales are still less than one third of their peak levels.

http://www.bbc.co.uk/news/uk-northern-ireland-18175464

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House prices 'below 2005 level'

An official house price index for Northern Ireland has revealed that prices are below 2005 levels.

The new Residential Property Price index is based on sale prices using stamp duty figures.

It found that prices have fallen 50% since the peak in 2007.

However, there has been a slight increase in the number of houses sold in the first quarter of this year compared to the same time last year.

In April, the Royal Institution of Chartered Surveyors said reduced household incomes and a growing number of house repossessions were to blame for the prolonged dip in the market.

In the last year, house prices have fallen 13% and have continued to fall by 7% in the first three months of this year.

The notional price of the average property in Northern Ireland is now £98,467.

Sales are still less than one third of their peak levels.

This may be worthy of a thread off of its own.

If you are looking for details about the new Residental Property Price Index here's the press release:

Subject: DFP News Release - NORTHERN IRELAND RESIDENTIAL PROPERTY PRICE INDEX - NEW PUBLICATION - WILSON

DEPARTMENT OF FINANCE AND PERSONNEL

23 May 2012

Northern Ireland Residential Property Price Index - New publication - Wilson

Finance Minister Sammy Wilson today welcomed a new Official Statistics publication that will provide a benchmark for the performance of the residential property market in Northern Ireland, using information on all sales from Land & Property Services and HMRC data sources.

The new Northern Ireland Residential Property Price Index (NI RPPI) is produced by Land & Property Services in conjunction with the Northern Ireland Statistics & Research Agency and will be published on a quarterly basis.

The NI RPPI will provide all those interested in the local housing market with Northern Ireland specific information on the change in residential property prices.

Sammy Wilson said: “Given the current difficult economic climate this new Residential Property Price Index will provide valuable information on a regular basis about our local property market.

“These statistics include analysis of the first three months of this year and show that residential prices have continued to fall, with an overall 7% in the first quarter of 2012.

“The Index also clearly shows that the rapid house price inflation which occurred between 2005 and 2007, when property prices nearly doubled, has now been rebalanced with house prices typically returning to pre 2005 levels. Whilst I appreciate the concern of some who purchased at the peak of the market, it is good news now for first time purchasers and those wishing to move up in a much more affordable housing market in Northern Ireland.”

The NI RPPI has been developed using recognised methodologies, and using the most complete and accurate data available on all property sales in Northern Ireland. The housing market analysis will be based on data relating to house sales on the open market in Northern Ireland from 1 January 2005 onwards. It is produced to the Code of Practice for Official Statistics standards.

Notes to editors:

1. Northern Ireland Residential Property Price Index (NI RPPI) was published on 23 May 2012 and can be access via the LPS section of the DFP website: http://www.dfpni.gov.uk/lps/statistics-and-research-publications.htm

2. The NI RPPI provides information covering the period 2005 to date.

3. The NI RPPI provides information across a range of types of properties and geographical areas.

4. The statistics are produced in compliance with the Code of Practice for Official Statistics standards ensuring that they are produced to high professional standards and free from political interference.

This is an automated distribution service - please do not reply to this email address.

---------- Forwarded message ----------

From: <EIS.Newsservice@ofmdfmni.gov.uk>

To: <EIS.Newsservice@ofmdfmni.gov.uk>

Cc:

Date: Wed, 23 May 2012 09:38:41 +0100

Subject: DFP News Release - STATISTICS PRESS NOTICE - NORTHERN IRELAND RESIDENTIAL PROPERTY PRICE INDEX: QUARTER 1 - 2012

DEPARTMENT OF FINANCE AND PERSONNEL

23 May 2012

Northern Ireland Residential Property Price Index: Quarter 1 - 2012

The Land & Property Services, assisted by the Northern Ireland Statistics & Research Agency, today released the first Residential Property Price Index report for Northern Ireland.

The Index measures change in the price of residential property sold in Northern Ireland. The Index uses stamp duty information on residential property sales recorded by Her Majesty’s Revenue & Customs.

Results from the report show that:

over the 12 months from the first quarter of 2011 to the first quarter of 2012, prices of residential property sold fell by 13%;

between the last three months of 2011 and the first three months of 2012, prices of residential property sold fell by 7%;

looking further back the Residential Property Price Index for Northern Ireland peaked in the third quarter of 2007 (July – September 2007);

prices of residential property sold today are now just under half of their peak value; and

whilst sales prices are falling, the overall number of properties sold is increasing. Around 2,600 verified residential Northern Ireland properties were recorded by Her Majesty’s Revenue & Customs in the first quarter of 2012. This is a 9% increase over the number recorded in the first quarter of 2011.

Notes to editors:

1. This is a new official statistics publication. The Northern Ireland Residential Property Price Index is a quarterly index and will be published in February, May, August and November each year, around eight weeks after the end of each quarter.

2. Results for the second quarter of 2012 will be published on 22 August 2012.

3. The detailed statistics report is available at: http://www.dfpni.gov.uk/lps/statistics-and-research-publications.htm and http://www.nisra.gov.uk/HousePriceIndex/hpi.html. Further statistics by area and property type (detached, semi-detached, terraced, apartment) are available on the website.

4. The contents of this report will be of interest to government policy makers, Members of the Legislative Assembly, the business community, property professionals, economic commentators, academics and members of the general public with an interest in the NI residential property market.

5. The statistics are based on property sales recorded by Her Majesty’s Revenues & Customs. Under statute all property transactions must be notified to HMRC for stamp duty purposes, excepting a small number of transfers which are exempt from duty (e.g. property transfer due to probate, divorce etc.).

6. The performance of the residential property market is measured using the price of a standardised property. A detailed paper on the methodology used is available on the LPS/NISRA websites at: http://www.dfpni.gov.uk/lps/statistics-and-research-publications.htm and http://www.nisra.gov.uk/HousePriceIndex/hpi.html

7. As this is the first release, users’ comments or any issues relating to the statistics are particularly welcomed and encouraged. Responses should be addressed to:

Responsible Statistician: Ms Ciara Cunningham

Email: Ciara.Cunningham@dfpni.gov.uk

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This may be worthy of a thread off of its own.

If you are looking for details about the new Residental Property Price Index here's the press release:

7% in the first 3 months of htis year is an amazing number... Would be interested to see if the BOI report says something similar!

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One estate agent, Henry Pryor, said that sellers need to be realistic on price in the current market.

"The credibility gap between typical asking prices and resultant sale prices means that many buyers are being mercenary when it comes to making offers," he said.

"Most have learned that an asking price is not necessarily a guide to current value and are often treating them derision. Selling has never been tougher."

:lol::lol::lol: Most have learned? ... This makes me laugh.

Asking prices are shockingly out of kilter with reality? I would go as far to say that asking prices are now OFFENSIVE to buyers.

Its interesting to hear an EA talk about credibility!! :ph34r:

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Gamechanger.

You will note they state "below 2005" - so why not say 2004? well their records only go back to 2005, and they can only state current prices are below this from their available figures.

The headline should read 2004 prices - or earlier -

2. The NI RPPI provides information covering the period 2005 to date.

It appears the only difference in this and the (suspiciously late) UUJ report is the source of the information ie official govt stats v Estate Agents. Oh and the £40k difference in average selling price.

Is there any further need for the UUJ report?

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Wow, finally :)

Hopefully other NICS departments might join in on this strange concept of giving the people that pay them to collect the data access to it!

I know the Land registry index on the mainland does not include repos since they are "not market value". However after some campaigning they are looking at this again.

I haven't read through the methodology of the NI property index yet but the information should be there and if not then there is an address to comment to the statistician.

It seems to say as long as it is a taxable transaction it will be in there, the exceptions it lists are for a few categories where HMRC are not notified, so my guess is it is included.

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Links dont work for me but I will try and check and even email ms Cunningham. Given tax implications I am pretty sure they will be or should be.

EAs can do deals before houses "hit the market", buy them themselves or even under report to UUJ which was only ever a sample of EAs anyway. Generally though they can't avoid tax.

I always smelt a rat with the UUJ EA BOI combo.

I note it has now disappeared from the main BBCNI website.

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Theoretically, has this new index fast forwarded where abouts in the crash we are by a few years?

Using the UUj index, the average house price is £161k. Using the new index, it's £98k. Some drop in average house prices overnight.

If we were all working off the UUj and thinking average price was 7.5 times wage, we wake up today and find it is actually 4.5 times the average wage- with the long term average something like 3.6 times the average wage.

Are we nearing the bottom after all?! This £98k figure suggests what we all knew anyway, majority of house sales are at the FTB/btL investor level. I see a stack of houses selling at the £50-60k range, decent semis in decent areas selling at £100-120k.anything else just sits there gathering dust on the EA shelf.

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Glad to new see we approve of Government figures. These figures are quite in depth and up to date. And as pointed out above are vastly different from other surveys. I assume, as they are from Land Registry they will include all transactions. Auctions included. Whilst they band in house type and region they dont in price bracket so the roll out of the investor repo's at £40k to £60k will have a big pull on the average. And that's fine with me. It means however we cant compare these prices with that shown in the UK as the methodology would be different.

As for the 7% drops over the last 3 months. Well I for one haven't noticed it. We sold more houses in the first quarter of this year than last year and last year's first quarter was an improvement on the one before that.

But we will take the figures as presented and watch as they go. With average duel income households, which is the predominate purchaser for us I could claim that the ratio is now just over 2. However, the average price that we sell is well above this £98k figure.

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Glad to new see we approve of Government figures. These figures are quite in depth and up to date. And as pointed out above are vastly different from other surveys. I assume, as they are from Land Registry they will include all transactions. Auctions included. Whilst they band in house type and region they dont in price bracket so the roll out of the investor repo's at £40k to £60k will have a big pull on the average. And that's fine with me. It means however we cant compare these prices with that shown in the UK as the methodology would be different.

As for the 7% drops over the last 3 months. Well I for one haven't noticed it. We sold more houses in the first quarter of this year than last year and last year's first quarter was an improvement on the one before that.

But we will take the figures as presented and watch as they go. With average duel income households, which is the predominate purchaser for us I could claim that the ratio is now just over 2. However, the average price that we sell is well above this £98k figure.

So your average price is what 125K. With an income ratio of 2 they would need to be on 30k each. Right... Both well above average salary and but a semi shoebox.

That's a healthy market. :blink:

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Glad to new see we approve of Government figures. These figures are quite in depth and up to date. And as pointed out above are vastly different from other surveys. I assume, as they are from Land Registry they will include all transactions. Auctions included. Whilst they band in house type and region they dont in price bracket so the roll out of the investor repo's at £40k to £60k will have a big pull on the average. And that's fine with me. It means however we cant compare these prices with that shown in the UK as the methodology would be different.

As for the 7% drops over the last 3 months. Well I for one haven't noticed it. We sold more houses in the first quarter of this year than last year and last year's first quarter was an improvement on the one before that.

But we will take the figures as presented and watch as they go. With average duel income households, which is the predominate purchaser for us I could claim that the ratio is now just over 2. However, the average price that we sell is well above this £98k figure.

It's not a survey on what you sell - or don't sell. Its everything, everywhere.

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Some extra recognition - 9% rise in sales - repos and auctions included.

House prices remain in turmoil - its turmoil out there I tell ya (with the odd exception :blink: )

http://www.newsletter.co.uk/news/business/business-news/house-prices-remain-in-turmoil-1-3875634

To be published on a quarterly basis, the inaugural index offered little joy yesterday revealing that although sales in the first part of the year have risen slightly, property prices as a whole are now seven per cent lower than in the first quarter of 2005 and around half of the peak value of the market in the third quarter of 2007.

The NI RPPI includes sales of all properties sold at auction for cash and through estate agents but excludes the sale of Housing Executive stock to tenants as those involve discounted prices that would distort the overall view.

Officials at Land & Property Services yesterday defended the inclusion of auction prices – which tend to be distressed sales involving mostly repossessed properties – arguing that they reflect the reality of the market at present.

The index measures change in the price of residential property sold in Northern Ireland, and uses stamp duty information on residential property sales recorded by Her Majesty’s Revenue & Customs.

The launch of the new index comes a day after figures from the UK Office of National Statistics reported a 10.7 per cent drop in prices in the province. It also joins other surveys including the well-regarded University of Ulster House Price Index and the RICS Housing Market Survey from the Royal Institution of Chartered Surveyors.

The 13 per cent drop in prices was measured over the year to the end of March 2012, but the index also reflected other reports about increased activity in the market as it showed around 2,600 sales in the first quarter – a nine per cent increase.

Edited by Shotoflight
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I never thought I would say this...

To be fair to the Nationwide AND UUJ reports - are the percentage falls not similar to the RPPI index?

Does anyone know the peak price the RPPI index is using?

Big Bad Bear head back on...

News that average prices are below £100K is going to have a big psychological effect on the market.

Back in 2007 I was one of a handful of people on this forum who argued that average house prices would fall below £100K

My prediction of a 60%-70% nominal fall taking 3-7 years (2014?) is looking spot on!

However, I still cannot understand how house prices have not crashed in the rest of the UK, 5 years after prices here started falling.

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So your average price is what 125K. With an income ratio of 2 they would need to be on 30k each. Right... Both well above average salary and but a semi shoebox.

That's a healthy market.

Sorry you read my post wrong, or perhaps to be honest I presented it wrong. Going by the CML the average household income of a purchaser is over £40k and going by this report the average house is now £98k. Therefore, even if they were to get 100% loans, which they don't they are borrowing ad 2.2 or there abouts.

I said I cant claim that ratio for our sales as the average price of our houses is above the £98k and above the price you have stated.

If prices have fallen 50% and incomes (somehow) have remained the same (or increased if you accept other government reports)then the ratio has halved from what it has. Is this now a healthy market? we all will differ on that one and the absence of a healthy mortgage market plays into the conclusion of that discussion. However what I think we all can agree on is the halving of the ratio from what it once was is a dramatically healthier market from what we once had.

The Nationwide look at the income ratio for FTB'ers as this is all that really counts. They have looked at it in NI from 1983 and have an average of 3.1 over that period.

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I never thought I would say this...

To be fair to the Nationwide AND UUJ reports - are the percentage falls not similar to the RPPI index?

Does anyone know the peak price the RPPI index is using?

Big Bad Bear head back on...

News that average prices are below £100K is going to have a big psychological effect on the market.

Back in 2007 I was one of a handful of people on this forum who argued that average house prices would fall below £100K

My prediction of a 60%-70% nominal fall taking 3-7 years (2014?) is looking spot on!

However, I still cannot understand how house prices have not crashed in the rest of the UK, 5 years after prices here started falling.

In fairness to BB he has predicted that, although his time frame slips, but then again I don't think any of us predicted the crash taking this length.

I think you would find if the UK's figures were analyzed in the same way as this report, without a banding around price groups they would be lower too.

Depending on which report you read we are back at 2005 prices and dropped around 50%. The UK are back at 2005 prices as well. The reason why they haven't dropped so much is simply down to the fact that they didn't grow as much, between 2005 and 2007 as we did.

During the three years leading up to the crash NI's prices increased by 120%.

Over the same time the UK's prices increased by around 30%.

Therefore they didn't have to undo as mush of the growth bubble as we did.

On the 'psychological effect' of prices being reported to be under the £100k- I would have to think about that one. Some might now say they are very good value at that level. Obviously others wont.

One thing that hasn't been flagged up is the 2,6000 (if I am right)sale completions in the quarter. This might be a bit higher as the Stamp holiday ended in March. However, this is away ahead of what the other reports are stating. if that is reflective then the an figure would be over 10,000 sales, which is higher than I thought.

Edited by BelfastVI
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Back in 2007 I was one of a handful of people on this forum who argued that average house prices would fall below £100K

My prediction of a 60%-70% nominal fall taking 3-7 years (2014?) is looking spot on!

BB whilst there is no doubt you (amongst several other posters here and elsewhere) were accurate, I think we are all aware of this now and do not need reminding anymore. Not meant to be arsey, but I just find the self-back-patting a bit OTT. Feel free to disagree.

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In fairness to BB he has predicted that, although his time frame slips, but then again I don't think any of us predicted the crash taking this length.

Not true. I said I would not buy a house before the end of 2010. But before that, I was predicting that the crash would take 3 to 7 years. 2007 + 3 = 2010 = do not buy before. 2007 + 7 = 2014.

In 2007 I memorised this quote, "Prices continue rise on dwindeling volumes." Now we are experiencing the opposite effect.

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BB whilst there is no doubt you (amongst several other posters here and elsewhere) were accurate, I think we are all aware of this now and do not need reminding anymore. Not meant to be arsey, but I just find the self-back-patting a bit OTT. Feel free to disagree.

My prediction has not yet been proven to be correct. I continue to search for evidence that it is correct.

Besides, I like to rub it in to some of the property bulls who I took so much crap from on this forum back when the crash was starting. After some of the personal attacks I experienced, I think I earned the right to remind them here who was completely wrong. Were you reading this forum at that time? If so, feel free to disagree.

That prediction was arrived at after months of discussion and research into house price income ratios and previous bubble durations. Some new readers maybe interested in my prediction.

Edited by Belfast Boy
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My prediction has not yet been proven to be correct. I continue to search for evidence that it is correct.

Besides, I like to rub it in to some of the propety bulls who I took so much crap from on this forum back when the crash was starting. After some of the personal attacks I experienced, I think I earned the right to remind them here who was completely wrong. Were you reading this forum at that time? If so, feel free to disagree.

That prediction was arrived at after months of discussion and research into house price income ratios and previous bubble durations. Some new readers maybe interested in my prediction.

I'd joined here and left way before then because it was too quiet! I do appreciate where you're coming from, and also the get-at-the-bulls angle. Seriously doubt any of them read here anymore though.

Thought I'd post this old graph here for interest (figures I recorded from Propertynews from Dec 2006 on the other HPC site)

hpc.jpg

post-33264-0-48325200-1337886724_thumb.jpg

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In fairness to BB he has predicted that, although his time frame slips, but then again I don't think any of us predicted the crash taking this length.

I think you would find if the UK's figures were analyzed in the same way as this report, without a banding around price groups they would be lower too.

Depending on which report you read we are back at 2005 prices and dropped around 50%. The UK are back at 2005 prices as well. The reason why they haven't dropped so much is simply down to the fact that they didn't grow as much, between 2005 and 2007 as we did.

During the three years leading up to the crash NI's prices increased by 120%.

Over the same time the UK's prices increased by around 30%.

Therefore they didn't have to undo as mush of the growth bubble as we did.

On the 'psychological effect' of prices being reported to be under the £100k- I would have to think about that one. Some might now say they are very good value at that level. Obviously others wont.

One thing that hasn't been flagged up is the 2,6000 (if I am right)sale completions in the quarter. This might be a bit higher as the Stamp holiday ended in March. However, this is away ahead of what the other reports are stating. if that is reflective then the an figure would be over 10,000 sales, which is higher than I thought.

The 9% rise in sales to 2,600 (a third from peak) is flagged up in the NewsLletter article I reproduced above. I'm not surprised it captures more sales - it is a comprehensive report, not an extrapolated EA sample and does include auctions as stated. Lets see if it lasts (the increase in sales). If the increase drives prices down faster, of course I welcome it. It will give EAs and buyers plenty more "comparables" and that won't be a bad thing for the next few years.

As with the frenzy on the way up, at what stage do sellers panic and get real. Are we nearly there yet?

I note you call up the Nationwide again - I thought we agreed their sample size (and niche lower level market) left their stats questionable - certainly in terms of representing the whole market or indeed in any worthwhile terms?

I also read somewhere (so could be dodgy but seems reasonable) that on average (oh yes) the second income of a two income family is about £8k - which chimes with women,many with children, in low paid part time catering, retail, public sector type jobs. I won't stand over this but I think, even if joint income is £40k its not just about buying the house now - it's the inflationary environment, childcare and job security, sentiment and emergency interest rates that weigh on purchasers minds, and especially seeing others get fried. Surely most dual incomes will have, or expect to have sprogs?

Finally - who was the audience for the UUJ report? Govt policy makers or estate agents (or the public)? If it was govt policy makers, why did they feel the need to do their own. And why would UUJ keep producing what they did based on a sample of unregulated EAs, now we have this?

Edited by Shotoflight
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Ramsay Tweets

@PaulGosling1 reason being terrace mkt was the main vehicle (& higher return) for BTL investor so was pumped up more & fell more

@chrislindsay_ unfortunately new survey starts in 2005 and below this level now. probably around 2002/03 levels

23 May Ramseconomics Ramseconomics ‏@Ramseconomics

N.Ireland new Residential Property Index shows peak to trough (2007Q3-2012Q1) fall of 55% for Apartments & 60% for terrace properties

23 May Ramseconomics Ramseconomics ‏@Ramseconomics

New Residential Property Price Index released for N.Ireland today. Incl. all sales not a sample. 53% PTT decline so far http://www.dfpni.gov.uk/lps/statistics-report-quarter-1-2012-published-23rd-may-2012-617kb.pdf

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I read this in the News Letter (reproduced above) report but wasn't sure of it's accuracy. I am now,

The standardised residential property price is now 7% lower than in the first quarter of 2005.

RV - 2005 price - is now an aspiration for sellers, drifting off over the horizon and accelerating.

Sales were 42,000 in 06 so we are looking at a 75% drop not 66%

Sales are not only banded, but by house type, region and 3 different averages - graphically and numerically.

I am impressed by the reports' comprehensive nature, source data and rigour.

It will do for me. And I'm not concerned about comparing it with other guesstimates.

UUJ and, for that matter, Nationwide can whistle.

"The contents of this report will be of interest to Government, Members of the Legislative

Assembly, the business community, property professionals, economic commentators, academics

and members of the public interested in the property market".

They got that bit right too.

Edited by Shotoflight
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  • 418 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
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      • up 5%



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