Q: The average house in Northern Ireland now costs around £10,000 more than it did one year ago. According to the latest Halifax House Price Index, house prices in NI increased by 5.3% in the 12 months to January 2024, the fastest annual rate of any UK region. As Blend’s Lending Manager based in Northern Ireland, how do you see market activity being on the ground?

A: It is well known that Northern Ireland suffers from a lack of housing stock.  The demand is outstripping supply, and this is one of the reasons why prices are continuing to rise.  Even last year when mortgage rates were at their peak, houses were continuing to sell at and above asking prices. 

In terms of activity levels among house builders, they were lower than normal last year.  For builders, they really have had a perfect storm as increased build costs, increased finance costs and uncertainty about whether the selling prices of their finished units could come under pressure, meant that it was an undesirable time to start new projects.  It’s reassuring to see that prices have held tight, as this at least gives builders the confidence to know what prices they will achieve for their finished schemes.    

Q: Blend has supported property developers in nearly every county of Northern Ireland. What sets Blend apart from other lenders? Why do property developers choose to borrow from Blend?

A: Here at Blend, we’ve been supporting Northern Irish property developers right since we started back in 2018. We’ve always been really committed to the region, even when there are not many development finance lenders who are actively lending here. Northern Ireland is one of the most affordable places to live in the UK, yet it suffers from a steep housing shortage. So, we’re here and are committed to supporting mid-size property developers who are building the homes the region needs. As to what sets us apart, I’d say it’s the fact that we don’t just talk the talk, we actually walk the walk and deliver what we say to developers. Over the past 18 months, it’s been a very difficult market for property developers and many have seen how their lenders pulled back on facilities they had agreed to lend on. At Blend, we deliver what we say we will from day 1. Another important point that sets us apart is our agility and ability to get things done. Being a specialist lender rather than a Bank, we can be less dictated by policies and more driven by what makes good commercial sense.  You also can’t beat good old customer service and quick decision making – because in property development, time is money!

Q: What are your predictions for 2024 for Northern Ireland’s housing market?

A: Simply put, it’s my view that house prices will continue to push northwards.  Northern Ireland is one of the most affordable places to buy housing in the entire UK, and it’s a great place to live.  I believe that our housing market will come under continued outside pressure, mainly from people settling and/ or investing from ROI and GB.  I feel that falling interest rates will fuel this, by arming people with the affordability to bid prices up. 

In terms of house builders, I believe their activity levels will increase to a more normal level.  Material prices appear to have stabilised, or in some cases, such as timber prices, have reduced.  The cost of finance will likely reduce in line with BOE base rate.  What would really help house builders is if the return of power-sharing meant that some changes could be made to increase the speed of obtaining planning permission; and for there to be a significant investment in the sewer capacity, both of which are material contributors to the shortage of housing. 

Q: The most recent scheme you’ve funded is a scheme of 4 townhouses and 11 apartments in Holywood. Walk us through this scheme and tell us more about it, what the developer is trying to achieve and how was Blend able to support him.

A: Holywood has everything you could want from a place to live.  It’s a lovely town and is easily commutable to Belfast.  The latest scheme we’ve funded will offer new homes with sea views, which are within easy walking distance of the town centre.  The developer has designed a scheme which makes the most of its views. It will be suited to families, professionals and downsizers.  The customer had acquired the site some time ago, and we provided a development facility to fund the full construction costs.   It’s a project we’re delighted to be involved with.