Northern Ireland’s Property Boom Could Continue Into 2022
NORTHERN Ireland’s booming property market could continue into 2022 according to a leading property developer as demand continues to exceed supply.
Tanya McGeehan, Managing Director of MCG Investments said: “The first half of 2021 was an exceptionally busy period for the residential property market here in Northern Ireland. Following the post lockdown recovery last year and in the context that home building activity was reported as down 15% in 2020, there has been significant demand in new houses brought to the market.
According to PropertyPal, activity of this level has not been seen since 2006, with year-to-date sales up since last year by over 40%. Given the interruptions to the market in 2020 from the pandemic, this increase is not a surprise but the rate of increase is beyond many industry expert’s best predictions.”
“There is huge liquidity out there at the moment. A combination of estimated savings in the region of £200bn cash (Bank of England) by UK residents, alongside the support measures pumped in by government to businesses means that many of the transactions are taking place without borrowings or with modest loan to value ratios. That is a good thing and is very different to the ‘highly leveraged’ property transactions that took place around 14-15 years ago which were unsustainable and ultimately led to the property crash in 2008.
All of the indicators suggest that the economic recovery from the pandemic is ahead of schedule and subject to no further economic ‘lockdowns’ the economy could be fully recovered by late 2023,” Tanya continued.
“In my 15 years involved in property management and development I can safely say that I have never seen a time like this. Properties of all types are achieving sale agreed in record time and in many instances above their asking prices. Recently we brought three luxury new apartments to the market in South Belfast and achieved sale agreed above asking prices in less than two weeks.
There is little sign of the market slowing down and Northern Ireland still has plenty of scope to grow, since our residential property values had not fully recovered since the last downturn. The summer months are generally a quiet period for the property market, however this was not the case this year with PropertyPal enquiries in June up by 95% from the same period in 2019 however total sales stock is down around 38% so there are not enough homes on the market to meet this increased demand. New homes are being viewed by record numbers and in particular detached family homes are very popular. We are confident that this demand is set to continue for the rest of the year and well into 2022 so if you are considering putting your house on the market, now is still a good time,” Tanya added.
According to Tanya, the buy-to-let market is also trading successfully: “In the investment side of the MCG business, we are working with a number of new clients to acquire buy-to-let portfolios in Belfast, as the rental market remains very strong and our property sourcing services have never been busier. Some investors are achieving yields of 9+% on some of our rental properties which is very attractive alongside capital growth, when bought at the right price, in the right areas.”
Northern Ireland’s buoyant property market has enabled MCG Investments to achieve continued growth in the first six months of 2021 and the company has expanded in a way that it would not have expected when the company was formed four years ago.
“We have been monitoring property sales closely since the beginning of the pandemic. The most popular property type is now three and four bedroom detached properties with larger gardens. In response to that we have purchased a number of these property types for ourselves and our clients.
These acquisitions have put us in a strong position for the rest of 2021 as our development projects that are on site are mostly detached and semi-detached properties in popular residential areas in Belfast. The demand for superbly finished family homes is very high in those areas and in one case, we are dealing directly with one buyer who is essentially seeking to buy our property “off plan” from us prior to the refurbishment even starting. This way, the purchaser gets to input into the layout and interior design to suit their own personal preferences,” Tanya said.
“It’s a really exciting time for the team at MCG Investments, as we have established new partnerships with other developers and investors, including overseas connections working on larger schemes including new build apartments in Belfast and other locations in Northern Ireland.
2021 has been an excellent year for our company and with the projects we have in the pipeline it looks like 2022 will be even better!” Tanya concluded.