City homes market in £124m fillip

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EDINBURGH'S property market has been given a £124 million shot in the arm amid a big rise in the number of homes sold.

Sales totalling 283.7m were completed in the Capital during the last quarter – 77 per cent up on the same time last year.

This comes after more than 1,300 properties were sold through the Edinburgh Solicitors Property Centre (ESPC) – 57 per cent more than last year. And the average house price in the Capital rose almost 13 per cent year-on-year to 218,043.

ESPC business analyst David Marshall said the rise was fuelled by an increasing number of high-value homes being put on the market. He said: "Sales are still below what we'd expect in normal market conditions, but considerably more than we were seeing towards the end of last year."

Larger properties fared best for rising value, with the average price of a three-bedroom semi-detached property up by 7.6 per cent to 245,496. But the the value of a one-bedroom flat in the Leith Walk/Easter Road area was down 4.3 per cent to 109,584.

There was good news for those in the city centre, where the average value of a home was up 10.9 per cent, to 245,517, and in Marchmont/Bruntsfield, where two-bedroom flats had risen 10.7 per cent to 265,565.

There were also rises outside the Capital, with the average price of a house in East Lothian up 13.6 per cent to 210,905. In West Lothian the average was up 14.5 per cent to 177,289.

Mr Marshall said: "The larger properties are faring better than the smaller properties. That's largely because the people buying three or four-bedroom houses don't have to worry about deposits as much as those at the other end of the property market."

He predicted that prices would remain broadly unchanged in the coming year: "On one hand, we are likely to see a continuation of increasing demand from buyers as lending restrictions are eased somewhat and confidence continues to return to the market.

"Offsetting this, however, is the prospect of a rise in unemployment during 2010 coupled with the likelihood of an increase in interest rates over the medium term. There will be fluctuation from month to month, but broadly speaking the outlook is that homes' values will be broadly unchanged over the next 12 months as compared to 2009 levels," he said.

Steven Currie, director of estate and lettings agent Currie and Murray, said he was concerned to see such dramatic rises in the number and value of sales.

He said: "I will be more comfortable with the figures when they're more stable and the rises aren't so dramatic. When sales are 57 per cent up on this time last year, that's not what you want to see.

"We want to see three or four per cent increases with the market stabilising."