This site uses web cookies · Read our Policy here
International: (+34) 952 198 657
Open navigation menu

''Mixed Picture'' for Scottish Housing Market

First name: 

 

Last name: 

 

Tel. Number: 

IPIN Disclaimer.

  We never share your data with any third parties.

*Note: IPIN investment opportunities are available subject
to location and certain knowledge / experience criteria.

News by Category

Archives



United Kingdom  Scotland  Real Estate Investment  London  Glasgow  Royal Institution of Chartered Surveyors  Office for National Statistics  ONS  Mortgage Products  Lloyds TSB  Average House Prices  Residential real estate values  LSL  Richard Sexton  Ayrshire  Donald MacRae  Acadametrics  Sarah Speirs  House Price Monitor 

''Mixed Picture'' for Scottish Housing Market

By - Monday 25 June 2012

Several organisations have recently released figures showing how the Scottish housing market is faring, with a mixed bag of results. While some report prices and sales are up, others have revealed a downward trend. Starting with the good news, the LSL Property Services/Acadametrics Scotland House Price Index for April 2012 noted house prices were up 0.3 per cent month-on-month, although annually they fell by 0.6 per cent. This puts the average cost of buying a home north of the border at GBP 146,309.

The organisation pointed to an overall positive trend in Scottish residential real estate values, though, noting that while prices were down year-on-year in April, the fall was considerably smaller than that recorded in March, when values slid by 1.4 per cent. In addition, the research found house sales were 12 per cent higher in the four months from January to April this year than in the same period of 2011. Director of e.surv chartered surveyors, part of LSL, Richard Sexton said the market is "coping admirably" with the tough economic conditions, while the second consecutive monthly price rise indicates the situation may be improving.

"Cautious optimism describes the prospects for the market over the coming months. Demand for moving home is still strong, despite buyers having to piece together the big deposits needed to access affordable mortgages," he asserted. Mr Sexton added the lack of available finance, rather than lower demand, is what has caused the slump in the market. Although the national figures appear to be moving in the right direction, he acknowledged many regions of the country have seen prices fall, rather than rise, with Glasgow and Ayrshire singled out as two of the areas to experience the biggest declines.

According to the Office for National Statistics (ONS), however, Scotland saw just 0.3 per cent shaved off the value of properties in April, compared to the same month a year earlier. In contrast to the LSL/Acadametrics index, the ONS data put the average cost of home in the nation at GBP 178,000, which is considerably lower than the median value of properties in England - which stands at GBP 237,000 - although this figure is boosted by the expense of London housing. Both these organisations paint a relatively positive picture of the Scottish residential property sector, but not everyone shares in this optimism.

Lloyds TSB's Scottish House Price Monitor revealed values fell by 2.7 per cent in the three months ending in April 2012, while annually prices were down by 4.4 per cent. According to the financial institution, it now costs an average of GBP 148,024 to buy a home in Scotland - putting it in line with the estimations made by the LSL/Acadametrics research. While the Lloyds TSB data shows much larger falls in value, it did reveal sales were up considerably in the first quarter of 2012. Transactions increased by 8.6 per cent year-on-year, however, chief economist at the firm Donald MacRae attributes this rise to the end of the stamp duty holiday for first-time buyers.

"The Scottish housing market has shown a slight pickup in sales at the beginning of the year, influenced by the change in stamp duty. There is no sign of a return to the levels of prices and transactions of 2007, but equally no precipitous falls in either house sales or house prices," he stated. So, the view from Lloyds TSB appears very much to be that things are stable - they haven't got much better or much worse - but there is still a long way to go before a sustained recovery will be seen.

The final research to look at is that published by the Royal Institution of Chartered Surveyors (Rics) earlier this month, with director of Rics Scotland Sarah Speirs describing the residential property sector as "stagnant". According to the Rics UK Housing Market Survey for May, prices, demand and sales all fell, with those questioned as part of the report expecting this downward movement to continue in the near term. Ms Spiers commented: "The ongoing economic instability in the UK and overseas has continued to undermine consumer confidence, and the reluctance of many banks to offer affordable mortgage products has created something of a stagnant market."

So, what does all this mean for property investors? In a nutshell, that you need to look beyond the headline national house prices and focus on a macroeconomic level. If you want to make a real estate investment in Scotland, you have to assess the area you're considering buying in on its merits - taking account of everything from the state of the local market and economy to infrastructure, jobs creation and educational facilities.

Subscribe to IPIN Live by Email - Get our News & Blog updates delivered directly to your inbox - click here

Glossary

Visit Our Investment Terms Glossary


Comments

 

*This page is provided for information purposes only and should not be construed as offering advice. IPIN is not licensed to give financial advice and all information provided by IPIN regarding real estate should never be treated as specific advice or regulations. This is standard practice with property investment companies as the purchase of property as an investment is not regulated by the UK or other Financial Services Authorities.


«« Back to IPIN Live

Follow IPIN Global


Latest Content

Recent Comments

Powered by Disqus