As Donald Trump starts his stint in America’s Oval Office with a quiet few days designed to spread love, peace and harmony throughout the world and the UK government tabling the Parliamentary Bill for the UK to exit the EU following June 2016’s ‘Brexit’ vote, it’s looking like being an eventful 2017. We take a look at how the year has begun in your local property market and how the rest of the year is shaping up.
House Prices Continue to Increase Whilst Selling Times Fall
Throughout 2016, property prices in East Central Scotland rose steadily, with the latest reports from ESPC showing that property prices rose by 4.9% in the period from October and December 2016 when compared to the year before. In the same period, they reported that selling times had decreased from 35 days to 25 days. This demonstrates a continued trend from 2016 of steady buyer demand and a reduced number of properties coming to the market driving house prices gradually upwards.
Registers of Scotland reported that house prices in Scotland, as a whole, increased by 0.6% in the third quarter of 2016 compared to a 2.3% decrease in the second quarter. It does seem that East Central Scotland, comprising Edinburgh and the Lothians as well as parts of Fife, saw stronger house price performance than the rest of Scotland in 2016.
In our Annual Predictions for 2017, we suggested that 2017 would likely see a continuation of the steady, if not spectacular, growth in property prices in East Central Scotland and nothing we have seen so far this year has changed our opinion.
High Buyer Demand in Seller’s Market
The latest data release from Registers of Scotland showed that the volume of residential sales across Scotland, as a whole, in September 2016 was 9,352. This represented an increase of 8.5% on 2015 and an increase of 10.4% on the previous month. This actually compares with annual decreases in sales volumes of 22% in England, 10.4% in Wales and 10.7% in Northern Ireland.
This reflects the trend that we have seen in the past couple of years where, in spite of decreasing numbers of properties coming to the market for sale, sales figures have continued to be strong. In fact, properties that probably wouldn’t have sold just a few years ago for the prices that are now being asked are selling relatively quickly, largely because of the lack of choice that buyers find themselves with.
Commenting on these figures, Registers of Scotland Director of Commercial Services, Kenny Crawford, said: “The increase of 8.5 % is the first year-on-year increase in sales volumes in Scotland since March 2016, when volumes of sales increased by 45.4% when compared with the previous year.
“Changes in Land and Buildings Transaction Tax are likely to have contributed to the significant increase in March and to the subsequent lower volumes in the following months. Volumes in September 2016 are also 18.6% higher than in September 2014 and 26.7% higher than in September 2013.”
For more information about Land and Buildings Transaction Tax (LBTT), the Additional Dwelling Supplement (ADS) and whether you may be caught by the ADS, 3% surcharge on purchasing an ‘additional home’, we have written a detailed guide which you can find here.
ESPC’s data shows that the volume of property sales between October and December 2016 actually decreased by 6.3% when compared to the year before whilst the number of homes coming to the market decreased by 8.1% annually. In other words, sales continue to perform more strongly than ‘listing’ activity (in other words, homes coming onto the market for sale).
The market, therefore, continues to favour those thinking of selling their homes this year and we would encourage anyone who is thinking of selling in 2017 to take advantage of the current buyer demand and lack of supply to the market.
Once again, it does seem that East Central Scotland is outperforming the Scottish market as a whole, with Registers of Scotland reporting that the City of Edinburgh in particular recorded the highest volume of sales throughout Scotland at the end of September 2016.
As always, some areas are shining compared with others and it was reported by ESPC that the number of properties sold in Leith and Corstorphine, between October and December 2016, eclipsed all other areas of East Central Scotland whilst Portobello and Joppa recorded significant price increases in the same period. For a bit more information about these ‘hot spots’ and what this means if you’re thinking of selling or buying in those areas, have a wee look at our article here.
We’re Here to Help
If you are selling your home or investment property in 2017, please do get in touch with us by calling 0345 646 0208 (Option 1) or by emailing [email protected] to organise a free valuation of your home or to get a full, transparent breakdown of the costs of selling your home. Our expert Valuation Department can help you with suggestions to maximise the appeal of your home to buyers and get the best possible price if you are selling. For more tips about preparing for a property valuation, you can also check out our YouTube video, Getting the Best Possible Property Valuation.