House price growth has slowed to its lowest rate since the early months of the Covid-19 lockdown, according to a report.
he residential market survey from the Royal Institution of Chartered Surveyors (RICS) and Ulster Bank said the number of estate agent members reporting an increase in house prices had fallen in the past three months.
There were seasonal factors at play, the RICS said, along with continued repercussions from turmoil in the mortgage market and rising interest rates.
Property professionals told the survey they expected the market to keep slowing, but the Northern Ireland outlook was less pessimistic than the UK as a whole.
Indicators of demand in the housing market, such as enquiries from new buyers, were also at their lowest level since the early pandemic, reflecting a UK trend.
As in other parts of the UK, Northern Ireland surveyors said there was a fall in newly agreed sales. Potential sellers were also taking a wait-and-see approach, with many surveyors reporting a fall in new properties coming onto the market in November.
Estate agent and RICS residential property spokesman Samuel Dickey said: “Northern Ireland is still seeing easing in enquiries and demand from extremely high levels earlier in the year, which is expected given the turbulence in the mortgage market paired with the time of year.
“While the market is in a different place than it was earlier in the year when demand was higher, we would expect the lack of supply to continue to be a factor in the market for the foreseeable as we continue into the new year.
“Although factors including higher interest rates are clearly weighing on surveyors’ outlook, we continue to see relatively steady levels of activity in the market and I don’t expect that to change dramatically as we move into 2023.”
Terry Robb, head of personal banking at Ulster Bank, said the housing market was closing 2022 in a different mood than it had been at the start of the year.
He added: “Earlier in 2022, demand was exceptionally high, but that has eased in the second half of the year due to a range of factors, not least the market turbulence of a couple of months ago and increases in interest rates.
“Ulster Bank has though continued to see good demand for mortgage borrowing, and as we move into 2023, we remain strongly committed to supporting mortgage customers with a full range of products available.”
RICS UK chief economist Simon Rubinsohn said the “downbeat” tone of the survey reflected the uncertain economic environment and rising interest rates.
But he added that even though the mood was bleak, continued low unemployment could mean that any downturn in the housing market could be shallower than previous experiences.
A separate house price survey from the Halifax building society recorded a 2.3% fall in house prices in November, marking the biggest monthly drop since 2008.
The yearly rate of house price growth slowed to 4.7% from 8.2% in October, Halifax said. The average house price was £285,579.
