Prime Minister Theresa May is due to unveil Brexit plan B to Parliament today but it is unlikely to differ much from her first version. Following a crushing defeat on the Withdrawal Agreement and having narrowly survived a no-confidence vote, Mrs May offered an olive branch of cross party talks but was rebuffed by Labour leader Jeremy Corbyn. Talk of an extension of Article 50 is on the rise but an exit from EU without a deal is still possible.
The labour market continues to strengthen but wage growth refuses to escape its sluggish trajectory
The latest Northern Ireland Residential Property Price Index shows that overall average house prices increased 3.1% quarter-on-quarter and 4.4% year-on-year. Continue reading
As we approach the 10th anniversary of Northern Ireland’s house price peak (and subsequent correction), we’ve been seeing some encouraging signs in the mortgage market.
2016 saw Northern Ireland notch up its fifth consecutive year of mortgage growth. According to the Council of Mortgage Lenders (CML) there were 13,800 loans advanced for house purchase. This represented a rise of over 5% year-on-year, with last year’s total representing the most mortgages advanced since 2007.
Despite a rise of 80 percent since 2008 though, mortgage volumes in Northern Ireland are still only half of what they were a decade ago.
The number of first-time buyers in Northern Ireland hit a 10-year high last year (8,000). However, this is still over 10,000 fewer than 2001’s peak.
The recovery in the mortgage market has been more marked within the First-Time Buyer (FTB) segment than the Home Mover market. The latter’s recovery has been somewhat disappointing.
In 2016, there were only 5,800 mortgages advanced in the Home Mover market; this was just 1/3rd of the volume of activity in 2006 and on a par with 1980/81. Lack of supply of certain property types and the legacy of negative equity are hampering this market.
House building is on the rise and people are gradually paying off their debt. But the legacy of what happened 10 years ago will continue to be felt for some time to come.
Those waiting for the post-vote shoe to drop will be disappointed. On most measures either the initial ‘Brexit’ shock has been reversed or it never happened. So much depends on jobs – their availability and pay. It’s early days still.
A former Bank of England Governor once said of central banking that “boring is best”. Last week though, central bankers were once again hogging the limelight. First off, the US Federal Reserve, which having raised rates must now work out whether the economy can support them. Second the Bank of Japan, which joined the negative rate club. And with all eyes on the Bank of England this week, “boring” seems a distant memory.
It’s been a long haul but does normality finally beckon? The minutes of the recent Federal Open Market Committee meeting – the US equivalent of the Monetary Policy Committee – show its members edging close to raising the Fed Funds rate in December. If the Fed’s judgement is correct and growth is sufficiently strong to merit a hike, it would be another indication that the very long shadow cast by the financial crisis is waning.
Northern Ireland’s housing market is also moving slowly but surely away from the shadow of 2008, with residential property prices now +21% higher than their trough. However, they are still 48% below their (freak) peak, so the shadow won’t be totally gone for a while yet.
It was a busy week of economic news in Northern Ireland. Here are five things you need to know:
It has been a busy past week or so for economic data, covering, amongst other things, the housing market, labour market, inflation, and oil prices. Ulster Business magazine also published its list of NI’s Top 100 Companies. Here’s a rundown of the main points:
1. Ulster Bank NI PMI
The Ulster Bank Northern Ireland PMI was released on Tuesday. It showed that output growth at NI private sector firms was maintained in June, as new orders rose at an accelerated rate. Increased new business led to a build-up of outstanding work, but the rate of job creation eased. Meanwhile, cost inflation moderated and companies raised their output prices for the first time in ten months.