East Belfast Sectoral Study - Northern Ireland Housing Executive

6.0 Key Housing Issues
• Affordability
Affordability has emerged as a major problem in Northern Ireland since 2001. In 2001
over 60% of all house sales went to first time buyers as the low interest environment
and flexible mortgage products combined to ensure that debt servicing costs generally
remained at manageable levels.
The rapid house price growth since 2003 has seen the proportion of sales to first time
buyers fall steadily so that by 2006, only 30% of all sales were to first time buyers. This
indicates the scale of the problem facing many potential first time buyers who are now
being forced to remain with parents, apply for social housing or enter the private rented
sector.
East Belfast has traditionally been a” high price” area with average prices above both
the Belfast city and Northern Ireland levels. The terrace market has seen almost frenzied
competition between investors and first time buyers pushing prices to unprecedented
levels. East Belfast has also benefited from a lack of sectarian division, with the
exception of the Lower Newtownards/ Short Strand interface. Furthermore the location
of several well known schools within East Belfast has made the area popular for
families, so that prices in the middle and upper sector of the market are often on a par
with South Belfast.
The Review of Affordable Housing undertaken by Sir John Semple reported in April
2007 and makes a series of recommendations to improve access to affordable housing.
The Housing Executive responded positively to this review. Implementation of its
recommendations will cross existing Departmental responsibilities and will require a
“Joined Up “ approach. The Housing Executive is fully committed to this concept and
will incorporate the Review’s recommendations, where appropriate, into its existing and
future Area Based Strategies.
• Growth of private rented sector
The growth of the private rented sector in East Belfast can be attributed to a number of
factors, most notably market forces. More property has been made available as the Buy
to Let market has expanded and the pool of people wishing to live there has expanded
and other housing options, owner occupation and social housing, have become more
difficult to access.
The rapid growth of the ‘Buy to Let’ market has stymied the increase in owner
occupation throughout Northern Ireland. This trend is set to continue as poor stock
market performance and low investment returns since 2001/2002 has made investment
in property a safer option for many people. The increased number of properties
available for rent has had an effect on rental levels, making them affordable for many
people, particularly those potential first time buyers unable to gain a foothold in the
current inflationary climate. While the current huge price rises are not expected to
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