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Residential Property Price Index exclusive thread


2buyornot2buy
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With all the HPCers buying recently, I thought the quarterly reports might actually show house prices going up in the winter :blink::unsure::D

I wonder will the RPPI show a 'spring bounce' in their next report - like the other reports sometimes do?

Will a bounce in the RPPI report indicate that the bottom of the market is near or just nearer?

With an increasing number of repossessions hitting the market, I doubt it.

With annual falls still much bigger than a years rent - there is no need to rush to buy a house.

When the annual falls are equal to, or less than a years rent, that is the time to buy.

That time cannot be too far away. My non-expert but slightly educated guess is 12-18 months. ;)

Edited by Belfast Boy
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With all the HPCers buying recently, I though the quarterly reports might actually show house prices going up in the winter :blink::unsure::D

I wonder will the RPPI show a 'sping bounce' in their next report - like the other reports sometimes do?

Will a bounce in the RPPI report indicate that the bottom of the market is near or just nearer?

With an increasing number of repossessions hitting the market, I doubt it.

With annual falls still much bigger than a years rent - there is no need to rush to buy a house.

When the annual falls are equal to or less than a years rent, that is the time to buy.

That time cannot be too far away. My non-expert but slightly educated guess is 12-18 months. ;)

I think you're right BB. 12-18 months could be the bottom for the bottom, I think the middle and top end of the market will drag it out for much longer.

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Who me? What did I do :lol: At the price point I bought into for the property I purchased there was no way house prices were going up. 21.25% below 2005 Capital Rateable Value speaks for itself.

With all the HPCers buying recently, I thought the quarterly reports might actually show house prices going up in the winter :blink::unsure::D

I wonder will the RPPI show a 'spring bounce' in their next report - like the other reports sometimes do?

Will a bounce in the RPPI report indicate that the bottom of the market is near or just nearer?

With an increasing number of repossessions hitting the market, I doubt it.

With annual falls still much bigger than a years rent - there is no need to rush to buy a house.

When the annual falls are equal to, or less than a years rent, that is the time to buy.

That time cannot be too far away. My non-expert but slightly educated guess is 12-18 months. ;)

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Signs of recovery in house sales - BUT NOT PRICES.

http://www.belfasttelegraph.co.uk/business/business-news/signs-of-recovery-in-house-sales-29085127.html

But Mr Ramsey said: "We still anticipate an overall peak-to-trough decline of around 60%. Some property types have already posted decreases of 60% – ie, terraced properties and apartments."

Rising sales translated into good news for the economy as solicitors, furniture shops and estate agents benefit – but Mr Ramsey cautioned against waiting for a rise in house prices as a sign the market had stabilised.

"If and when transaction levels reach 20,000 every year, that would be the green light that things were stabilising."

Economist John Simpson said the increase in transactions and the slowdown of price-drops "would convince me that the worst is over for the housing market".

Desmond Turley of Ulster Property Sales in Belfast said transactions were up in his agency but added that more lending was necessary for any price increases to take place.

Conor Mulligan, managing director of housebuilder Lagan Homes, said new home transactions were less badly hit than RPPI figures, which include repossessions, suggest. He said the company sold 80 new homes in 2012, compared to 200 in 2006.

What is simpson smoking - Q3 was revised downwards and Q4 shows -3% ( -13%pa). Have I missed something? - sustained 1% per month falls in a market where everything including the kitchen sink has been thrown at it. (is it not cheaper to buy than rent?)

It'll be a while before we see 20,000 sales PA in my view unless there is a further surge in auctions, repos and co-ownership - and even with that it'll be quite a way off.

The way I see it, things are just starting to get interesting.

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House sales at highest level since 2007 peak

http://www.irishnews.com/business/house-sales-at-highest-level-since-2007-peak-1232759

One of many barometers for the state of the housing market, the index is compiled by Land and Property Services (LPS) and the Northern Ireland Statistics and Re-search Agency (Nisra).

As it is based on actual stamp duty paid for new properties, it is considered perhaps the most accurate indicator of house prices.

"Northern Ireland's detached property market posted the steepest year-on-year decline in Q4 (-19 per cent) as it effectively plays 'catch-up' with the correction experienced within other property types."

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  • 2 months later...

Bit of a damp squib.

Sales up 1% on same quarter a yr ago. Prices down 6% from last yr & 1% from previous Q - still falling. Still 13% below Q1 2005 and 56% from 2007 peak.

http://www.nisra.gov.uk/HousePriceIndex/hpi.html

As a result of more up-to-date data, the Q 4 2012 NI Residential Property Price Index has been revised from 87 to 88 , therefore indicating that the residential property prices fell by 2 % between Q3 2012 and Q4 2012 (as opposed to the 3% reported in the last statistics report) and fell by 12% over the year to Q4 2012 (as opposed to the 13% reported in the last statistics report).

A Quality Report is under development and will be available on the website in the future.

Inflation also still eroding values, presumably.

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  • 2 months later...

Been reading postings on this site for more than a year, doesn't seem that anyone expected this price increase. How can prices rise in a recession that is hitting this area disproportionately hard, with incomes squeezed, unemployment high, cost of living going through the roof. Anyone got any good ideas why prices are rising and if it is likely to continue.

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It seemed to me the report indicated more of the same despite the 2% rise. 33% of properties sold at under £90K with not too many sales above £150k - so a continuation of an improving FTB market and investors buying which has been widely reported. Still a "sluggish" second step market in evidence.

To answer your question, my opinion/guess would be that FTB houses probably don't have too much further (if any) to fall - however, second step homes have a bit of air to come out of the asking prices yet. However, with more mortgages on offer and the bank of mum and dad not yet exhausted, it could take a while to play out yet imo.

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Been reading postings on this site for more than a year, doesn't seem that anyone expected this price increase. How can prices rise in a recession that is hitting this area disproportionately hard, with incomes squeezed, unemployment high, cost of living going through the roof. Anyone got any good ideas why prices are rising and if it is likely to continue.

I think most of the other reports have been showing a slow down in falls and a return to growth in 2013. The ONS was actually showing a YoY growth rate earlier in the year. The UUJ had been showing rises also (small drop in most recent one).

I think everyone was noticing the sentiment change out there and you could see it is some of the comments made here.

This might sound strange but I dont want prices to rise too fast or by too much. Once people are happy that their houses are likely to increase over the next 10 years, instead of fall they will start to buy. If they only go up with inflation then they remain the same in real terms and everyone is happy.

Credit supply will be the big thing. Will this allow the mortgage companies to start lending again. Not crazy stull. sensible multipliers and 90 or 95% max L2V.

Also good to see that volume has again increased with a 10% on the same quarter last year, which in turn was a 20% increase in the same quarter in 2011.

Edited by BelfastVI
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Been reading postings on this site for more than a year, doesn't seem that anyone expected this price increase. How can prices rise in a recession that is hitting this area disproportionately hard, with incomes squeezed, unemployment high, cost of living going through the roof. Anyone got any good ideas why prices are rising and if it is likely to continue.

Sales increased by 10% Q on Q and prices rose 2% - across all house types. Not sure if the usual mix of auction/cash transactions was higher or lower (or the same) as earlier reports, as they are not disaggregated.

However, to put things in perspective, we need another straight 6 of these 2% quarterly increases (taking us into 2015) to inch above Q1 2005 prices driven, at least partly, by increasing volumes.

I don't know if Q3 will be +2%, -2% or 0. I had thought a fall at -5% for this year was doable (currently -3%). Time will tell, there are so many variables at play especially, as BVI states, credit. It should be remembered that the majority of sales now also come under the co-ownership threshold which has had further capacity added by Govt. UUJ report seemed certain Help to Buy 2 was coming here in Jan 2014 and, apart from any intentional consequences of the policy (raising volume), it may also cause some distortions and will be one to watch.

Increasing sales show an increasing willingness, or acceptance, for vendors to sell at 2005 -11% (currently) and 3% less than last yr, and therefore increased choice for those interested in buying.

Anecdotally, a solicitor was saying they were busier at lower end, dead in the middle and no expectation of prices taking off in the next 5 - 10 yrs. A lot of debt in the middle especially those that bought in the past 8-10 yrs, says he.

From the report.

The index now shows a 53% decline from the peak and the standardised residential property price is now 11% lower than in the first quarter of 2005. It is still too early to say if the Northern Ireland property market has bottomed out.

Edited by Shotoflight
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Some other nuggets and graphs

http://www.nisra.gov.uk/housepriceindex/NI_RPPI_Statistical_Report_Q2_2013.pdf

It is interesting to note that house prices were rising in 2005 in line with the UK and Irish economies, even though the Northern Ireland economy showed only very modest growth in 2005.

In 2005 median house prices were around 5 times a median annual full time salary, but by 2007, at the peak of the market, prices were more than 9 times the median salary. With the downturn in the property market since 2008, the ratio has continued to fall and in 2012 was lower than levels in 2005.

The median residential property sale price is now just over 4 times the median annual gross full time earnings

.

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However, to put things in perspective, we need another straight 6 of these 2% quarterly increases (taking us into 2015) to inch above Q1 2005 prices driven, at least partly, by increasing volumes.

I don't know if Q3 will be +2%, -2% or 0. I had thought a fall at -5% for this year was doable (currently -3%). Time will tell.

Increasing sales show an increasing willingness, or acceptance, for vendors to sell at 2005 -11% (currently) and 3% less than last yr, and therefore increased choice for those interested in buying.

If my calculations are correct, even if prices remain the same for the rest of this year, this report will show a +1% for the year on year in Q4 2013. If they were to continue at "% for the next two Quarters that would show a 5% yon y

The report showed an increased willingness, or acceptance, for vendors to sell, and purchasers to buy at prices higher that Q1 2013 and higher than Q4 2012. Increased sentiment for those buying.

Edited by BelfastVI
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Average Household Income in NI (Department for Communities and Local Government; Live Tables)

2006 44,933

2007 49,777

2008 50,890

2009 49,511

2010 47,242

Above only goes up to 2010. I dont if it has increased and may have fallen. The average price in the NI Repo Report is £98k and assuming average income at say £45k we have a multiplier of 2.2. If we take the ONS (non Repo) figure of £130k we get a multiplier of 2.9. FTBers are borrowing perhaps 80% but the movers are borrowing less but even at 80% and the average price of 130k the borrowings to earnings ratio would be 2.3.

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Average Household Income in NI (Department for Communities and Local Government; Live Tables)

2006 44,933

2007 49,777

2008 50,890

2009 49,511

2010 47,242

Above only goes up to 2010. I dont if it has increased and may have fallen. The average price in the NI Repo Report is £98k and assuming average income at say £45k we have a multiplier of 2.2. If we take the ONS (non Repo) figure of £130k we get a multiplier of 2.9. FTBers are borrowing perhaps 80% but the movers are borrowing less but even at 80% and the average price of 130k the borrowings to earnings ratio would be 2.3.

How do they define a "household" in NI (or at all)?

How many banks allow pure multiples of 2 salaries as against weighted to one - eg 3x1 and 1 x other?

I thought I came across figures that for dual income households, the second earner earned an averaqge of £8k - ie low paid, female, part time typically

Your figures look suspiciously high, even if they are almost 3 yrs out of date - take single person households, 30% economically inactive, pensioners, 7% unemployed, 30,000 zero hours, 90,000 social housing, however many under the EU decency threshold etc. Do they include benefits?

As pointed out below, may be skewed by established, older households perhaps unlikely to be dabbling in the housing market and perhaps with income sources other than salaries - hence the "income" rather than salaries terminology.

I would be concerned about the assumptions surrounding your calculations.

UK from 2012 - families (as opposed to households?????)

Families better off than a year ago – but finances are boosted by mums forced back to work

http://www.thisismoney.co.uk/money/news/article-2152233/More-households-pressure-parents-working.html

The average take home pay for a family household is now £2,150 a month after tax and before paying bills.

This represents an above inflation four per cent rise on 12 months ago, the Aviva Family Finances Report revealed.

Families’ take-home pay has grown at a higher rate than for people across Britain generally because family households are more likely to include people who are older and more financially established, the study concluded.

Is £40,000 really a liveable income for families in the UK? NB UK Figure 2011

http://www.bbc.co.uk/news/magazine-15197860

Spending also depends on where you live in the country. In London, the South East, East, and South West of England, and Northern Ireland, spending for households is higher than the national average.

"About half the population doesn't have debt," he says. "It tends to be older people, as they have finished paying their mortgages and don't aspire to go out and spend on things like holidays."

Edited by Shotoflight
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How do they define a "household" in NI (or at all)?

How many banks allow pure multiples of 2 salaries as against weighted to one - eg 3x1 and 1 x other?

I thought I came across figures that for dual income households, the second earner earned an averaqge of £8k - ie low paid, female, part time typically

Your figures look suspiciously high, even if they are almost 3 yrs out of date

I would be concerned about the assumptions surrounding your calculations.

I listed the source of the tables. Banks look at what people can afford. Total income less total costs or expenses.

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