Average value of a home in North could rise 1% this year

The average value of a home in Northern Ireland could rise by 1 per cent this year, new figures show.

Northern Irish house prices, according to PwC’s latest UK Economic Outlook, are currently 44 per cent off their pre-recession peak.

PwC predicted the cost of a home in the UK could rise 3.7 per cent this year but the professional services group said the value of residential property in the North would be more stagnant.

Its latest Economic Outlooks suggested that the UK’s decision to leave the EU did not immediately impact on property prices but evidence showed that house price growth stalled in the second half of 2016 and there are currently definite signs of a slowdown.

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Based on property sales in the first four months of 2017, PwC estimated that average prices in the North could increase by about 1 per cent this year.

Its research also showed that in the past 10 years Northern Ireland has suffered the sharpest drop in the value of a home compared with anywhere else in the UK.

In contrast, London has seen the highest rise in house prices, with a 63 per cent price increase since 2007.

Gloomy outlook

PwC said the outlook for property prices in Northern Ireland remains gloomy and is forecasting the average value of a home by 2020 could be about £134,000, which would be 9 per cent higher than the 2016 average of £123,000.

Meanwhile, the average price of a home in the UK is expected to grow to £274,000 by 2020.

Aside from property values, PwC’s latest Economic Outlook also examined how the North’s economy has recovered since the banking crisis began in mid-2007.

It said that while employment levels have passed the pre-crisis peak, real wages are still only 94 per cent of their 2005 levels and real household disposable incomes are only 89 per cent of their 2005 levels.

PwC said this added up to an annual income cut of around £1,810 for most people.

The company also forecast that the North can expect economic growth of 1 per cent in 2017, but this is likely to slump to around 0.9 per cent next year.