After the announcement of today’s historic result in the Scottish Independence Referendum, with the country voting ‘No’ to an independent Scotland, many Scots will now be asking what the effect of this ‘No’ vote will be on the Scottish property market.
In short, I predict that the ‘No’ vote will cause a positive ‘bounce’ in the property market in Scotland.
Property market analysts, prior to the vote, had predicted that a ‘Yes’ vote could have a hugely negative effect on the market. National property website, Zoopla, last week predicted that up to £30,000 would be wiped off the value of an average property in Scotland if it became independent.
I said throughout the run-up to the referendum that the amount of negative publicity surrounding the property market was irresponsible and, on the whole, speculative. I was politely scathing of what I saw a reckless attempts to garner publicity by making a mountain out of a molehill when it came to the occasional buyer who indicated that, in the event of a ‘Yes’ vote, they wouldn’t proceed with their property purchase.
However, whilst much opinion and speculation, masquerading as ‘fact’, stated that a ‘Yes’ vote would have had a negative effect on the Scottish economy or the property market, there can’t be much doubt that a ‘Yes’ vote would have had a slightly unsettling effect on all markets, including the property market, at least in the short term.
With Edinburgh and the Lothians in particular being very dependent on the financial sector, any talk of companies and jobs relocating to England, however spurious or misleading, would have created an element of uncertainty that would have made people sit tight in their homes for a little while longer. Buyers, similarly unsure about their job prospects or work location may also have sat tight for a while longer. This could have caused a dip in property market activity that could have caused volumes and even prices to drop.
So, whilst we might have avoided a bit of a dip, are we going to see a ‘bounce’ in the property market, with buyers and sellers being more confident to make decisions about housing? I think so.
In the run-up to the Referendum, property market activity was so healthy in comparison with last year that it wasn’t possible to know what number of people was just biding their time until they knew the result. We knew that there were some: we just couldn’t know how many.
Within a couple of hours of opening our doors today, we have already had four potential sellers mention the Referendum, three of whom stated that they would not have sold had there been a ‘Yes’ vote. I anticipate that they are a minority and that there is a bottleneck clearing at the moment. However, as the scaremongering ends and my fellow professionals have no need to issue Press releases telling the world how bad the property market will be in the event of Scottish Independence, I would anticipate a ‘bounce’ in property prices and activity levels.
I foresee an unusually busy period in the property market, both for new properties coming to the market and for buyers coming forward with a view to securing their new home before Christmas.
It has been a landmark period in our country’s history, at times fractious and negative, at times optimistic and foreseeing better times ahead. It has engaged more people than ever in political debate about what Scotland, and the notion of being Scottish, to stand for. I can only hope that a great measure of that passion and determination to change things for the better continues for years to come and that we will emerge as a result of this Referendum process as a stronger, fairer and more self-determining country. What works well in London doesn’t necessarily work well in Scotland. The housing market in the past year has been a great example, with run-away prices in London prompting pressure on the government to alter tax policy and mortgage lending practice in a way that would have harmed a Scottish property market that was entirely removed from those market forces.
In the short term, the effect of the Referendum vote on Scottish property prices has yet to be seen, but I anticipate a bounce in supply, a rise in demand and possibly an increase in property prices as a result.