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RICS and Ulster Bank Residential Market Survey, October 2020

Demand remained strong in Northern Ireland’s housing market last month, according to the October 2020 RICS and Ulster Bank Northern Ireland Residential Market Survey. However, key indicators began to ease back from their high levels in September.

A net balance of 42% of NI respondents saw prices rising according to the October survey down from +78% in September.

When it comes to new buyer enquiries, a net balance of +26% was recorded in October, a solid increase but a softening from +47% in the September survey. Data for newly agreed sales and instructions to sell also remained strong at +43% and +20% respectively. However, these had also eased back from levels in September.

Looking ahead, a net balance of +25% of respondents said that they expect prices to rise over the next three months, and a net balance of +16% expect sales activity to increase in the three months ahead. On a 12-month horizon, NI respondents expect prices to continue to increase but they expect sales activity to ease back.

Anecdotally, NI surveyors say that whilst the current market is buoyant, they point to a more challenging period ahead.

Samuel Dickey, RICS Northern Ireland Residential Property Spokesman, says: “The stamp duty holiday has acted to encourage more buyers, and a good supply of property coming onto the market has also supported sales activity. As we head deep into winter, demand will likely ease off for now. In 2021, much will depend on the labour market, government support for the economy, as well as lending conditions. However, positive developments with a vaccine have given hope for life getting back to a greater degree of normality and with that the outlook for the economy should improve.”

Terry Robb, Head of Personal Banking at Ulster Bank, said: “The third quarter of the year was extremely busy in terms of mortgage activity and this continued into October with good demand from the full spectrum of borrowers. We have a range of competitive mortgage deals available as well as options for Co-Ownership mortgages which have been very popular. As a bank, we remain strongly committed to supporting people to buy their own home, to move house and to remortgage and will continue to lend in a responsible way that enables people to do so and supports market activity.”

Commenting on the UK picture Simon Rubinsohn, RICS Chief Economist commented: “The latest RICS survey provides further evidence of the buoyancy of the housing market with more buyers and sellers helping to boost activity across the country. However there is increasing concern that the combination of significant job losses over the coming month allied to the scaling back of policy initiatives in early 2021 will have an adverse impact on transaction levels. Meanwhile there is little sense this softer sales picture will be accompanied by very much easing in the momentum around prices and rents adding to the ongoing challenge around affordability.”