It has been a terrible time for residential property prices over the last six years, with a punishing market correction from the peaks of 2008 knocking over 50 per cent off the value of property in parts of Larne.
Stories of booming house prices in recent months closer reflect the London housing market than in East Antrim. Prices in parts of London have risen by over 20 per cent in the last year and this has fed through to other parts of south east England.
While we don’t have that sort of boom in Larne, there have been some encouraging signs since the start of the year. Sara Hagan, from house builder Hagan Homes, commented: “Bookings at the start of this year were the highest in our company’s 25-year history and in Larne there is now only one two-bed unit left in Corran Mews.”
The Government’s funding for lending scheme, coupled with the introduction of “Help to Buy” earlier last year, seem to have had the desired effect and the property market in most of the UK has been steadily growing over the last year.
Continuing low interest rates are helping to create the environment where house prices can recover from recent lows, but there will be challenges ahead when interest rates do eventually rise.
To further slow the property market in London, it’s thought that tougher lending criteria may be introduced. This has to be key to the future stability of the market. At the moment, the assessment used to establish future affordability of borrowing suggest that interest rates could rise to three per cent within the next five years. For those who have been able to borrow during times of very low interest rates, this could be crippling if the affordability forecasting is incorrect, and it could trigger another downturn in the market.
So providing that your budget can cope with an increase in interest rates in a few years’ time, it looks like this could be a great opportunity to get on to the housing ladder, particularly in Larne, where there are still some bargains to be had with properties for sale under the £100,000 mark.
David Hill is a Chartered Financial Planner and Independent Financial Adviser at Hills Financial Planning, 15 Agnew Street, Larne. He can be contacted on 028 28276814 or by email: firstname.lastname@example.org