Wednesday, 12 October 2016
House price growth remains firm in Scotland although demand weakens
House price growth in Scotland remained firm in September, despite negative readings from key indicators covering demand, agreed sales and new instructions, according to the latest RICS UK Residential Market Survey.
Scottish house price growth remained in positive territory, with 33% more respondents reporting a rise rather than fall last month. Near term price expectations across Scotland were also steady, with 14% more chartered surveyors predicting a growth in prices over the next three months. Elsewhere in the UK, there remains a greater level of caution in central London where prices are expected to continue to edge lower, albeit only modestly, over the same period. Anecdotal evidence suggests that uncertainty following the EU vote along with Stamp Duty changes, are both continuing to adversely impact the top end of the market in particular.
The lack of choice for would-be purchasers also appears to be restricting overall sales activity, with newly agreed sales dropping slightly during September. The regional picture remains mixed however, and going forward, respondents’ optimism towards the sales outlook in Scotland improved, with growth expected over the next three months. Further out, over the next twelve months, contributors throughout the UK are projecting sales to pick up firmly in all areas.
Thomas Baird MRICS, Select Surveyors, Glasgow, commented: “There was a slow-down in Home Report instructions for September, which is indicative of the lack of housing stock coming on to the market.”
Interest from new buyers in Scotland also fell over the month, with 16% more respondents reporting a decrease in enquiries (rather than an increase). On a national level the latest results show considerable variation in demand across the UK, with some respondents seeing a recovery while others report a more stable trend.
RICS chief economist Simon Rubinsohn commented: "The UK market does now appear to be settling down following the significant headwinds encountered through the spring and summer. Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market, which has been evident in Scotland over the last year. Although this is not a new story, it is a significant one having ramifications for both prices and the level of turnover.”