Two Up Two Down: Latest housing market statistics

Today’s batch of housing market figures for the third quarter could be summed up as “two up two down”. Two indicators (residential property prices and house completions) posted year-on-year growth.  Meanwhile housing starts and the number of residential property transactions are on the wane. 

Generation rent. House prices are always one of the most closely watched economic indicators by the general public or at least homeowners and potential first-time buyers.   Although the rise of the private rented sector over the last decade means for an increasing share of society, rental prices are more relevant than house prices. Homeownership is not on the radar for as many under 40s as it once was.

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Has Northern Ireland gone selfie mad?

Northern Ireland’s Labour Force Survey (LFS) churned out more record highs and lows of the positive variety in Q3 2019.  However, looking through all the statistical noise there are still signs that suggest the labour market cycle has turned. A surge in self-employment has been accompanied by a reduction in the number of ‘employees’ working. Meanwhile the total number of hours worked and average hours worked has eased back from its highs earlier in the year. Given the marked deterioration in business conditions in Q3 and Q4 it is expected that this will increasingly become evident within the labour market in the coming quarters. Q2 2019 is still likely to have represented the peak in the total number of employee jobs as measured in the Quarterly Employment Survey.

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Recovered, recovering and more work to be done

Northern Ireland’s record breaking labour market has been in the spotlight for quite some time. The focus has been on unemployment hitting all-time lows and the number of jobs reaching all-time highs in Q2 2019. In terms of job numbers, Northern Ireland’s labour market is clearly in a good place, having recovered all the jobs lost in the recession and created tens of thousands of additional jobs too. But what about wages and earnings?

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Brexit deal: something for everyone

Overall, there was something for everyone in the latest deal. The backstop was binned, there will be no hard border on the Island of Ireland and the UK will be free to follow its own independent trade policy. There was some surprise that the UK Prime Minister was able to secure a deal so quickly. While the EU made some concessions, the movement in negotiations was primarily due to Boris Johnson removing some of the UK government’s red lines.

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Three quarters full or three quarters empty?

They say a week is a long time in politics and it can also be a long time in economics. Over the past seven days, we’ve had a wave of data released that tells us much about what happened in the third quarter of the year and how the local economy is currently performing.

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Several strides forward…. one step back?

Northern Ireland’s labour market statistics have provided a plentiful source of positivity in recent years. Unemployment has hit lows that no economist forecasted and employment has never been higher.  The latest batch of data in the Labour Force Survey (June – August 2019) reveals some more record highs (e.g. employment amongst males). However, there are a variety of indicators that suggest that the labour market is on the turn. These signs of a weakening labour market must be placed in the appropriate context; namely, Northern Ireland’s labour market has never been stronger. Indeed, Northern Ireland’s unemployment rate remains at the ridiculously low level of 2.9%, just a shade above last month’s record low of 2.8%.

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Strong Q2 output figures provide a false sense of security?

Stronger than expected. Two surveys for the second quarter of 2019 revealed surprisingly strong output performance for the industrial (mostly manufacturing) and services sectors. The latter signalled a 0.8% q/q rise in Q2 which marked the fastest pace of growth  in output in five quarters.  However, this increase simply reverses the fall in the previous quarter.  As a result, Northern Ireland’s service activity has been flat for the first half of the year. Furthermore, the rate of growth on a year-on-year basis (Q2 2019 relative to Q2 2018) is a very pedestrian rate of growth (+0.5%) for the economy’s largest sector.

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