Wednesday, 15 January 2014
Number of homes coming onto the Scottish market begins to increase
RICS UK Residential Market Survey, December 2013
The number of homes coming onto the market in Scotland increased last month as the recovery in the nation’s property sector continued, says December’s RICS Residential Market Survey.
During December, a net balance of 44 percent more chartered surveyors reported an increase in new instructions, the highest in the UK. This is welcome news as demand continued to grow, with a net balance of 55 percent more respondents reporting a rise in new buyer enquiries in Scotland.
Despite the increase of homes coming onto the market, it is still not enough to meet the higher level of demand and as a result prices continued to rise across the country, according to a net balance of 54 percent more Scottish respondents. Significantly, every area of the UK saw prices increase with London and the South East experiencing the biggest jumps.
As the market begins to recover, respondents noted the importance of the Home Report, which provides essential information on the condition, valuation and EPC rating of a property. 71 percent of respondents said that their clients viewed the home report as a valuable tool in the house buying and selling process. With more sales now being finalised, growth in demand for rented accommodation has begun to slow significantly, as more renters opt to enter the sales market. Respondents noted that increased confidence is a key driver behind growing activity.
Sarah Speirs, Director RICS Scotland, commented: “Although the number of houses on the market falls short of demand, the increase reported is certainly a step in the right direction. Growing availability of affordable mortgages has released some pent-up demand from a market that, in recent years, has seen many viable buyers unable to enter the market. On the face of it, this seems like good news but unless we see a marked increase in the number of homes coming up for sale we could well be looking at a price rises becoming unsustainable in some areas. This is a central issue which will be addressed by the Scottish Housing Commission Report, published in April 2014.”
Perhaps unsurprisingly, given the more positive tone to the market, expectations for 2014 are decidedly upbeat. Respondents predict that both sales and price numbers will continue to increase through the course of this year. This is largely being driven by easing in credit conditions, resulting in higher loan to value mortgages, and the ongoing imbalance between supply and demand.
Kevin J MacDonald MRICS, Graham + Sibbald, Inverness, commented: “The market in 2013 ended on a promising note in the lead up to Christmas. Early signs are that 2014 has begun in a similar vein with activity from buyers enticing sellers to bring new properties to the market.”