City to buck UK trend with steady rise in house prices

Published on Wednesday 2 January 2008 09:27

ESTATE agents are predicting the city's housing market will be "steady as she goes" in 2008, with massive price hikes a thing of the past.

Market experts believe there will be slow but steady growth in the Lothians this year, with house prices rising by between one and four per cent.

The prediction comes despite gloomy forecasts of falling prices in the rest of the UK.

Leading solicitors and estate agents today described conditions as a "healthier market" which will be welcomed by both buyers and sellers.

Scott Brown, a partner with Warners Estate Agency, said: "A slowdown in the rate of growth is really to be welcomed. It spells great news for ordinary people who are simply buying and selling their homes, rather than looking to quickly make money. It is time some realism was injected back into the market.

"I think we'll see a growth of between one and four per cent in Edinburgh and Lothians – a steady-as-she-goes figure and one that reinstalls a sense of calm."

Mr Brown said Warners celebrated record-breaking sales last year, with around 1100 properties sold worth a total of 200 million.

And he said: "UK-wide there will be a noticeable slowdown.

"But Edinburgh has always been a very distinct market and any talk of a crash here is way off the mark."

Steve Spence, senior partner at Neilsons, agreed 2008 would be a good year for the Capital. He predicted sales would defy commentators intent on spreading "doom and gloom".

He said: "Historically prices have never gone down in Edinburgh and Lothians. We have our very own and very distinct marketplace. The prices may plateau and take a breather – but this is no bad thing.

"We foresee 2008 to still be very busy. Obviously different factors will affect how quickly the market will take off again after the initial Christmas and New Year slowdown. One is the 'blue skies effect' – if we have a mild winter then people feel like it is spring and want to move home. It may sound strange, but a sunny Sunday has a massive effect on sales."

Angus MacPherson, managing partner of Drummond Miller, said: "The natural plateau, with more realistic prices and growth, we are moving into is to be welcomed. We'll be expecting to see those people who lost out in 2007 return into the marketplace – this time with more success."

However, the latest national figures show Edinburgh is still a tough place for first-time buyers. It is the least affordable place to buy a home in Scotland, according to the Bank of Scotland, with average prices 8.2 times the average income.

Ed Griffiths, 29, an IT consultant from Leith Walk, said he and his girlfriend had been looking for a flat for several months.

He said: "I suppose it's good news that it's slowing down now, but most flats are still way over our budget. We'd love to be able to stay in this area, as it's handy for work and going out, but it's a struggle to find somewhere affordable. To be honest, having our own place seems like a bit of a dream at the moment."