North's house prices 'could take eight years to recover'
It could be 2016 before house prices in the North have recovered, an estate agent said today.
London-based Savills predicted years of gloom for homeowners because of the extent to which the local market was overheated.
However, one well-placed local estate agent dismissed the claims and said it was impossible to predict so far in advance.
Savills said: “Northern Ireland and the north east (of England) are forecast not to have recovered until 2016 with average growth between 2008 and 2020 of 33% and 19% respectively.”
Sales in the North have dropped 50% compared to the same time last year, a University of Ulster (UU) price survey has indicated.
Savills head of residential research Yolande Barnes said: “The extent to which the market was overheated on a local basis in 2007 is quite a lot to do with this and the rate that we think household income will rise.
“In terms of financial services it simply will take a long time for Northern Ireland to recover.”
Average house price stands at £226,934 (€286,000).
The credit crunch has made it more difficult to obtain a mortgage, with higher lending rates and predictions of more price falls deterring buyers.
Ms Barnes added: “This property market downturn has affected virtually all property sectors and UK regions simultaneously but regions will vary far more when the upturn comes.
“The lack of turnover and new supply which is such a feature of this downturn will be likely to lead to sharp increases in value in high-demand, low-supply areas.
“This downturn is severe and will almost certainly last for at least another year, but it is has been caused by the withdrawal of credit, not the withdrawal of long-term demand or by diminished purchasing power amongst owner occupiers.”
However, a local estate agent doubted the value of long-term assessments.
“It is like long-term weather forecasting, how can someone predict the market so far in advance?” he said.
“We are more concerned about activity and getting cycles and chains going. For most people it is about affordability.”
