Reports signal Scottish property market recovery

There was a glimmer of hope for Scotland’s beleaguered property market as reports signalled hints of a recovery.

The property market in Scotland is showing signs of recovery. Picture: Ian Georgeson

There is a “sustained demand” for new properties, the Royal Institute for Chartered Surveyors (Rics) Scotland said.

Regional property groups also celebrated good news.

In east central Scotland, there was a “significant upturn” in activity during the second quarter of 2013, the Edinburgh Solicitors Property Centre (ESPC) said, while Glasgow also reported an increase in sales last month.

This comes just days after housebuilder Cala signalled a return to growth in the new homes market with a major expansion north of the Border.

Surveyors questioned by Rics Scotland said that properties were generally selling within three months of going on the market, while 16 per cent more chartered surveyors reported prices rose rather than fell in June.

The outlook for prices is also strong, with 31 per cent more respondents reporting that prices will rise rather than fall over the coming three months.

“We are finally starting to see what looks like the beginning of a recovery in the housing market, with a rise in newly agreed sales,” said Sarah Speirs, director of Rics Scotland. “It is important to remember that activity levels remain depressed but the various initiatives designed to encourage the provision of finance into the market do appear to be paying dividends.”

The ESPC said the number of house sales across Edinburgh, the Lothians and Fife was at its highest level for five years – up by 13.4 per cent annually and by 26.1 per cent from levels seen between April and June in 2011.

“It is encouraging to see early indication that the market is starting to recover. Although early days, we are seeing signs that sales are increasing which is bringing more homes to market,” said David Marshall, business analyst with the ESPC.

In Glasgow and the west, selling times in the last quarter fell by a third compared to the previous three months, according to a separate report from the Glasgow Solicitors Property Centre (GSPC). The number of sales was up nine per cent on the previous quarter and by 32 per cent on the same time last year.

Professor Gwilym Pryce of Glasgow University, who analysed sales data from GSPC, said: “The latest data reveal some encouraging signs of house price recovery in the west of Scotland. We have heard premature claims of housing market recovery before, so caution is definitely a wise strategy here..”

However, while the number of homes selling has risen, the average house price in most areas is lower than was the case last year. In Edinburgh, the average selling price of a property in the three months to June was £216,006, down from £226,367 last year – an annual fall of 4.6 per cent. East Lothian saw a sharper fall in the average price, with a 13.7 per cent decline bringing the average price in the area to £195,899 – chiefly driven by a rise in the proportion of smaller properties selling.

Average property values last month made a return to the level of the beginning of 2006, the GSPC said – with the average selling price in the area rising to £119,000 – a recovery of more than £6,000 from a low point of £112,000 this spring.