Monday, 16 March 2015
Scottish housing market remains firm despite shortage in supply
Scotland and Northern Ireland continue to outperform the housing market of the rest of the UK, according to the latest RICS UK Residential Market Survey.
Price expectations for Scotland remained positive, with a net balance of 49 percent of surveyors predicting a rise in property prices over the next three months. The upward shift in prices is in part being driven by a decline in the number of houses coming onto the market, with supply continuing to fall behind demand in most parts of the UK.
Sarah Speirs, Director RICS Scotland, comments: “With supply restrictions continuing to impact the market in Scotland, it is imperative that the Scottish Government and industry look at viable solutions to the lack of housing and increase new start targets in order to meet needs.
“Respondents have also reported increased activity at the higher end of the market in the lead up to the introduction of Land and Buildings Transaction Tax in April and we will continue to monitor any impact of the new tax on all levels of the market.
“Across the UK, is encouraging that the negative trend in buyer enquiries appears to be dissipating, perhaps in part because of growing confidence that the cost of borrowing will stay lower for longer, but more worrying that instructions to sell property continue to drop. This very modest reversal in the demand picture is already being felt in the key measures of price expectations highlighting the extent of the challenge policy makers will face in addressing the housing crisis in the aftermath of the coming general election.”
Sales expectations over the next quarter remain positive, with 37 percent of respondents expecting an increase in transactions across Scotland. Across the UK the member forecast for house price growth over the next 12 months stand at 2.4% (up from 1.8% in January).
Iain Swayne BSc FRICS, Dunfermline and Environs, D M Hall, commented: “There is still a reasonable market with continuing demand but limited supply. Properties, if correctly priced, selling within a reasonable period.”
In the lettings market, demand continues to rise, while instructions remained steady. This is being reflected in the medium term view for rents with respondents, on average, envisaging an increase of 2.6% over the coming year.