While it is still too early to accurately measure the longer term impacts of the so-called ‘Brexit’ result of the UK’s referendum on EU membership, the housing market in Scotland has remained strong, say local solicitor estate agents.
The Scottish property market is experiencing a 6 year high in the level of property sales, according to the latest data from Registers of Scotland. This is at odd with recent reports from the Royal Institution of Chartered Surveyors (RICS) which say that the market in Scotland has suffered two consecutive months of falling sales whilst predicting that this trend is likely to continue during the quarter.
Accountancy firm Pricewaterhousecoopers (PwC) has also downgraded its growth forecasts for the Scottish economy, revising it down from 1.8% in March to 1.3%. PwC has also predicted that house prices in Scotland will fall before rising sharply after two years and has stated its belief that the Scottish property market will avoid recession, faring better than the property market in the South of England which will be most negatively affected.
Despite this, latest figures show a relatively healthy market with the ESPC having reported a 6.3% annual increase, between April and June 2016, in the average selling price across East Central Scotland. Solicitor estate agent firm, MOV8 Real Estate, has confirmed this trend, reporting that, in 2016, 89% of properties sold achieved their asking price, with 77% exceeding the asking price. They also reported an average selling time of 25 days.
MOV8 further reported an annual increase of 8.2% in the number of properties sold so far in 2016 versus the same period in 2015. While the ESPC reported a 5.6% annual decrease in the number of properties sold across East Central Scotland between April and June 2016, this is seemingly in line with a significant drop in the number of people deciding to put their properties on the market since the so-called Brexit vote compared with the same period last year.
Robert Carroll, Managing Director of MOV8 Real Estate, Estate Agents and Solicitors, believes that now that the initial uncertainty and shock, post-Brexit vote, has waned that the Scottish property market is in a healthy position.
“It is business as usual in Edinburgh and the surrounding areas, with the latest figures from the ESPC showing an increase in selling prices across East Central Scotland. While there have been reports of an annual decrease in the total number of sales across East Central Scotland, we are in fact seeing more sellers achieving exceptional results for their property sales, in exceptionally quick timeframes, than we have seen in the past few years.
“Following the referendum result, we have seen market fluctuations and uncertainty and, as we predicted before the referendum, the effects are likely being felt, and will continue to be felt, in the property market in the city of London and South of England.
“However, as we have been saying since before the referendum, the market in East Central Scotland, and indeed Scotland as a whole, finds itself fairly well insulated from these fluctuations, being less reliant on the wealth generated in the city of London. Most property buyers in Scotland are from Scotland and are moving relatively short distances from their previous home, leading to quite an ‘insular’ market.
“It is only a month or so since the so-called ‘Brexit’ referendum result, but what we are seeing right now is a market that is delivering excellent results for sellers, with great mortgage product availability, low interest rates and a level of property sales in Scotland at a six year high.”
With the property market in East Central Scotland continuing to perform well post-referendum, Carroll believes that some may be seeing property in Scotland as a ‘safe haven’ for investment, stating, “In times when markets are volatile, notably in response to unexpected socio-political factors which we have seen first hand in the past month, property is generally viewed as a ‘safe’ investment, and Scotland’s relative insulation from volatility in the City of London makes the property market here attractive for buyers from south of the border. This should ensure that Scotland continues to remain an attractive option for homebuyers and investors both at home and from the rest of the UK.”
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