Thursday, 12 November 2015
Supply shortfall pushes house prices up further across Scotland
The October RICS UK Residential Market Survey shows house prices continuing to rise in Scotland as a shortage of new stock supports growth, despite a slight easing in recent buyer demand.
For the third consecutive month, prices are reported to have risen in all parts of the UK in October. In Scotland, 38% more chartered surveyors saw house prices rise rather than fall and the outlook for the coming year is positive with a net balance of 54% expecting to see further price growth. East Anglia has consistently outperformed over this period with a net balance of 91% of surveyors in the area reporting growth this month
Buyer demand levelled off in October following twelve months of steady growth while supply also remained broadly unchanged. Despite the moderation in demand, sales activity continues to rise in Scotland, with a net balance of 26% more respondents seeing an increase in transactions in October.
RICS Scotland director Sarah Speirs commented: “It is hard to get away from the issue of supply when it comes to the current state of the housing market. The legacy of the drop in new build following the onset of the global financial crisis is now really hitting home with both the sales and letting markets continuing to show demand outstripping supply on a month by month basis.
“RICS would like to see a commitment from the next Scottish Government administration that delivers a definite plan for delivering attainable targets across all housing tenures to ensure that supply needs are met.”
In the Scottish lettings market, demand is also continuing to outpace supply in the three months to October*. This has been the trend nationally for some time, with the growth in demand continuing to outstrip that of supply. Unsurprisingly, rental expectations remain strong, with a net balance of 12% of respondents expecting a rise in rents over the next three months.