House prices inch to 7-month high

HOUSE prices in the Capital are at their highest level for seven months, it was revealed today.

The average Edinburgh home sold for 201,497 during April, according to the latest figures from ESPC. The figure is up from 194,683 in March, and at its highest since September. It is, however, a drop of 10.9 per cent compared to April 2008.

Chief executive of ESPC Ron Smith was cautiously optimistic. He said: "It is probably too early to talk about 'green shoots' of recovery at this stage.

"Restrictions on lending criteria and low consumer confidence will continue to dampen demand somewhat in coming months, but there is no question that the figures we have seen so far this year represent better news for homeowners than may have been anticipated.

"The average house price in Edinburgh fell sharply in the summer of 2008, meaning that house prices today are lower than they were at this time last year. Since then we have seen much more stability in prices and since last December the average price of a home in Edinburgh has consistently been in the region of 190,000 to 200,000."

While prices may have stabilised, the market is still small, with just 331 properties sold in April, two more than the previous month, and a 60 per cent drop on April 2008.

Leslie Deans, senior partner at Leslie Deans & Co estate agents, said: "This is very much in line with what we're finding. It shows that the decline which undoubtedly had taken place is bottoming out – we're noticing that and have done so now for about the last six weeks.

"We're seeing an awful lot more inquiries, viewings are up considerably and on the back of that, sales have picked up as well.

"We're finding in particular that in the south side of Edinburgh very strong demand continues for students' flats.

"Good quality bungalows across the city are once again proving to be very popular."

During April 36.8 per cent of properties sold at fixed price achieved their asking price – the highest level since June 2008, and up from just 17.7 per cent in March. The premium paid for "offers over" properties went up from 4.1 per cent in March to 4.9 per cent in April.

Scott Brown, estate agency partner with Warners, said the firm was once more having to introduce closing dates on property sales, a practice that had fallen away over the past 18 months.

He said: "Nobody is saying that the Scottish market has returned to how it was before the slump. Sales are still down at every property firm and we have seen falling house prices across the board over the past 18 months.

"However, the return of closing dates is a welcome sign that things are taking a turn for the better. There is still a lot of interest from prospective buyers for properties in Edinburgh and we have noticed that, if a home is particularly popular, the sellers are now able to set a date for offers to be received."