House prices in city plunge six per cent in year

THE average house price in the Capital has plummeted six per cent compared with the same period last year, despite brighter economic forecasts.

The latest report from Edinburgh Solicitors’ Property Centre revealed the average selling price in the Capital for the three months from September to November had fallen to £206,161, compared with £219,501 in 2011.

November was the fourth consecutive month in which a year-on-year decline in house prices was recorded.

Selling prices for three-bedroom semi-detached houses dropped 8.6 per cent in Edinburgh to £220,124 across the same period. Four-bedroom detached properties fetched £379,793 on average, down 7.9 per cent on last year.

Average selling prices for properties in West Lothian and East Lothian also took a hit, with falls of 7.2 and seven per cent recorded respectively.

The average property in West Lothian sold for £144,324 over the past three months compared with £155,165 last year. Selling prices in East Lothian similarly fell from £201,847 to £187,394.

The worrying figures came despite 22.6 per cent of Edinburgh property sales achieving their valuation over the past three months compared to 21.6 last year.

ESPC business analyst David Marshall said more homes had been sold across the Capital this year compared with 2011, but at prices below those achieved in the previous 12 months.

He said: “The number of people looking to sell is greater than the number who are in a position to buy, meaning that buyers are generally able to negotiate a selling price that is a few percentage points below Home Report valuation.

“Smaller properties remain less likely to achieve valuation than larger family homes. Just 17 per cent of one-bedroom flats sold in Edinburgh over the last three months achieved valuation compared to over 30 per cent of houses with three or more bedrooms.”

Midlothian weathered the conditions slightly better than the Capital, but still recorded a 4.3 per cent fall (£171,121 to £163,826) compared with the same period last year.

The doom and gloom contrasted sharply to figures from the Royal Institution of Chartered Surveyors, which showed 22 per cent more inquiries recorded from would-be buyers in Scotland last month.

Blair Stewart, partner in Strutt and Parker’s Edinburgh office, said: “Our market analysis from core areas of the New Town, the Grange and Trinity show that properties valued between £300,000 and £900,000 have been remarkably resilient.

“The statistics show that in these areas there is an increase in properties reaching Home Report valuation or above and this has been proved by a number of recent closing dates where competition has clearly returned to the market.”