Published on : Fri, 02 Dec 2005 09:12GMT
by : David Parker

The University of Ulster Quarterly House Price Index has revealed that Northern Ireland has become the property hotspot of the year with house prices registering a record 20 percent increase over the past year.

Ulster's property prices have been rising over the past year and it looks like this is not proving to be a problem with buyers and investors alike. The average price of a home in the area was found to be £139,520. It has also emerged that most people are not hesitating to remortgage their homes even in the face of these steep hikes.

“With an annual increase of 20%, Northern Ireland house prices are out-performing not only the expectations for the local market during 2005 but leading other regions of the UK where the pattern has been for slower growth," said Professor Alastair Adair, who along with Professor Stanley McGreal and Mrs. Louise Brown of the University of Ulster authored the House Price Index.

These sentiments found an echo with Alan Bridle, the Bank of Ireland's head of research in Northern Ireland who said, "This year is shaping up to be a record breaker in local house prices.

One factor at play is the attraction of property as an investment. Despite soaring prices, lenders report no let up in demand for buy-to-let finance or in the appetite of people to re-mortgage homes in order to buy a second property." However he added that there would be a lesser house price increases in 2007/08 as the slowdown in economy would invariably have an effect on the house prices.

The one downturn to the latest housing report has been the fact that first-time buyers are increasingly finding it difficult to get onto the property ladder. This is especially true because more than 65 percent of the houses on the market sell for more than £100,000. In Belfast, the average house price has jumped by 17.08 percent to £133,359.