ESPC House Price Report - August 2011
- House prices in the three months to August were lower than at the same time last year in most areas of East Central Scotland.
- In Edinburgh the average house price in the three months to August was £222,525 - down 3.6% annually.
- Annual rises were observed in Midlothian and West Lothian but these are unlikely to be prolonged in either area.
- The number of homes available on the market inched down over the summer but remains well above normal levels for this time of year.
- 68% of properties sold at Fixed Price were secured for less than the asking price - up from 56% during the same period last year.
- Projections are unchanged with house prices in coming months expected to remain between 3 and 5% below levels seen a year ago.
Latest figures released by ESPC reveal that the average house price in Edinburgh in the three months to August stood at £222,525. This marked a decrease of 3.6% from the same period in 2010. In East Lothian the average house price now stands at £223,347 - 5.3% lower than last year - whilst a 1.7% annual decrease in Dunfermline took the average house price in the town to £139,073.
The number of homes on the market came down slightly over the summer but is still higher than would normally be seen at this time of year. At the same time the number of people looking to buy is still significantly lower than pre-credit crunch levels allowing buyers to enjoy more success in negotiations. 68% of Fixed Price properties sold in East Central Scotland over the last three months were secured for less than the asking price, up from 56% during the same period last year.
David Marshall, business analyst with ESPC commented: "There has been little change in the market over the last few months. House prices rose in 2010 but are now starting to ease back meaning home values in most areas are now back in line with levels we were seeing two years ago.
"The market is most challenging for sellers of smaller properties, with low demand from first time buyers and buy-to-let investors meaning those wanting to secure a quick sale at this end of the market will probably have to be willing to accept a lower offer than they might have hoped.
"Trends so far this year have been in line with projections with prices easing back towards 2009. In months ahead this is likely to continue meaning we can expect to see house prices in most areas to remain between 3 and 5% lower than levels seen towards the end of last year."
The average price of a property sold in Edinburgh between May and July stood at £222,525, down 3.6% from £230,884 during the same period last year. The decline this year came on the back of a 9.5% year-on-year rise in 2010 meaning house prices remain ahead of 2009 levels.
David Marshall explained: "Generally what we've seen is falls this year offsetting rises in 2010 meaning prices are now back in line with, or heading towards, 2009 levels.
"One notable outlier in the figures this period is that the average price of a three bedroom semi-detached house in the city's suburbs is now 15% lower than it was a year ago £231,909. This followed a 17% rise at this stage last year meaning that even here prices are just back in line with those recorded in 2009.
"The volume of properties coming onto the market has fallen back over the last few months meaning that the number of homes available for sale is lower than at the start of the summer. Despite this, there are still more homes for sale than you would normally see at this time of year meaning that there is still significant competition amongst sellers."
The average house price in East Lothian between June and August was £223,347 - 5.3% lower than the value of £235,944 recorded during the same period in 2010.
Midlothian and West Lothian both saw a year-on-year rise in the average house price. In Midlothian a 5.8% increase took the average house price to £174,459, whilst in West Lothian a rise of 7.5% took the average to £173,953. In both cases the rises are likely to prove short-lived.
David Marshall explained: "The number of homes selling is around half of what you would have seen at the peak of the market. Lower sales volumes mean that you can see some volatility in the regional figures leading to short-term shifts in price that do not reflect longer-term trends. This is what we're seeing in Midlothian and West Lothian just now and in both instances I'd expect we'll soon see prices starting to head back towards levels seen during the first half of 2009."
The average price of a property sold in Dunfermline during the three months to August stood at £136,672 following an annual drop of 1.7%.
Commenting on these figures David Marshall said: "We saw the number of homes selling in August pick up somewhat after a quiet July but sales are still some way below what you would have seen at the peak of the market.
"There is still an excess of supply over demand meaning that market conditions favour buyers however with interest rates still at historically low levels many sellers do not feel under pressure to drop their price to secure a quick sale. Those who do wish to move quickly will probably find they have to accept a slightly lower offer, but of course when it comes time to buy the shoe will be on the other foot and the chances are that they will have to spend less on their next home than they might have expected."
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