Harsh Winter 'Moderates NI Rentals'
|Anxiety over falling house prices, job security and obtaining an affordable mortgage continued to prop up rental values in Belfast in 2010.
However, a new report also revealed today that after the hefty 7% jump in private rent prices recorded over the first nine months of 2010, prices fell by 4.6% over the last three months of the year - when December's Big Chill capped demand from renters.
The latest quarterly report by Citylets, Northern Ireland's largest dedicated online lettings site, confirmed that first-time buyers are also continuing to delay entering the housing market in the hope of better times ahead.
Northern Ireland's private rented sector generates an estimated £822m in rent receipts annually.
Year on year, average monthly rents held steady in 2010, with rents during the last quarter around £559 a month - about the same as 2009, but £13 lower than for the third quarter of 2010.
Citylets Rental Market Analyst, Dan Cookson, said: "We've recorded significant rises in rent prices over much of 2010, though the last three months of the year were noticeably quiet, with few people interested in shopping around for a new place to live in sub-zero temperatures ahead of Christmas.
"This helped to keep a lid on prices, which overall, remained strong," he continued, noting: "The pressure on young professional renters to come up with tens of thousands of pounds for a mortgage deposit at a time when everyone is worried about their jobs has forced many to delay their decision to buy and caused many to renew their leases."
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Despite this, some areas of the market did see a significant rise in rent prices over last three months of 2010, with one-bedroom properties commanding an average monthly rent of £504 – an increase of almost 13% on the year.
The average monthly price for two-bedroom properties, which account for the lion's share of the Belfast City and Greater Belfast rental market (42%), was up more than 2% year-on-year to £519 per month.
The Citylets Rental Index for Belfast stood at 98.9 in December 2010 - just 1.1% down from January 2008, when the Index was initiated.
In the equivalent period, property sale prices in Northern Ireland fell by 32.2%, according to the latest figures from Communities & Local Government.
Dan Cookson added: "Many renters are still keen to own their own home, but the cost of buying a house remains far out of reach.
"For example, a three-bedroom house for sale at £200,000 would cost more than £1,200 a month to buy over 25 years at current interest rates – and that's after paying a £20,000 deposit. The same property in the same area costs £650 a month to rent.
"With the average age of the first time buyer in the UK now at 33, it's easy to see why more people are renting for a few while before settling down to the responsibility of a mortgage."
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