ESPC House Price Report: July 2023
Property Market Data - Key Points:
- The average selling price of property in Edinburgh, the Lothians, Fife and the Borders was £287,820.
- Homes achieved an average of 103.8% of their Home Report valuation – 4.8 percentage points lower than the same time last year.
- Sales volumes decreased 10.3%, while the number of properties listed for sale decreased 1%.
- Properties sold in a median time of 19 days, six days slower than last year.
- 28.6% of properties went to a closing date, down from 37.9% the year before.
Average selling price holds steady across the board
During May-July 2023, the average selling price of property across Edinburgh, the Lothians, Fife and the Borders held steady in comparison to the same time last year. A marginal increase of 0.4% took the average to £287,820, showing that the property market overall has retained composure during a year of turbulence in the economic climate.
When we look at the specific market areas, some areas saw similarly small increases in average selling prices; properties in East Lothian and Midlothian experienced increases of around 2%, taking the averages there to £289,387 and £256,027 respectively.
By contrast, West Lothian experienced the largest decrease in average selling price across ESPC areas, with a dip of 8.2% in comparison to May-July 2022, meaning the average sat at £242,323.This could be due to the increase in sales of lower-value properties in comparison to last year. Other areas also saw smaller declines in average selling prices; West Fife and Kinross dipped 4.4%, while the Borders’ average decreased by 2.8%.
In Edinburgh, different areas saw different changes in their circumstances – the city centre experienced a 6% decrease in the average selling price (taking it to £341,185), however the suburbs of the South West saw average selling prices rise 7.4% to £380,382. This really demonstrates that each localised area experiences the market in unique ways; where areas are in such proximity to one another, it highlights how different the market can be and how varied buyers’ needs are.
For first-time buyers, areas including Musselburgh, Gorgie and Dunfermline all offered good options, with a variety of property types and sizes selling on average for less than the LBTT threshold price of £175,000. Dunfermline offered the most affordable property overall, with two-bedroom flats there selling for an average of £143,452.
Properties achieve less of Home Report valuation as buyers bid more cautiously
In response to the current financial climate, we would expect to see buyers behaving more cautiously when offering on properties and taking affordability into higher account. This has been reflected in the figures we see for May-July 2023, with a small reduction in the amount of Home Report valuation that properties have achieved at sale.
80.5% of properties for sale in May-July 2023 sold for at least their Home Report valuation, which is strong news for sellers, however this figure is down from 93.2% at the same time last year, when the market was very competitive, and buyers were behaving differently.
In terms of the amount paid, homes achieved on average 103.8% of their Home Report valuation during this period. This is 4.8 percentage points less than the same time last year, however, again we would expect to see this during a time when buyers need to be more cautious with affordability.
In sharp contrast to previous years, more properties were listed for a fixed price, rather than ‘offers over’ – our data shows a 62% increase in the volume of properties listed for fixed price during May-July 2023, compared to the year before. This considerable change in the way properties were bought and sold during this time can be attributed to the changes we see in the amounts paid for properties, as many fixed-price homes are listed for their Home Report valuation and sometimes less.
Volumes of properties on the market similar to last year
The market continued to show signs of steadying when it came to the volumes of properties coming to the market and selling.
Less properties were sold during May-July 2023; the figures show a 10.3% decrease in comparison to the same time last year, which we could attribute to the cost-of-living crisis and/or mortgage rates making it more difficult for buyers to secure a property purchase.
The number of properties listed for sale held steady too – a marginal 1% decrease in the volumes shows that there are still plenty of available homes, and potentially more sellers in the market than buyers at the current time. This means some good news for buyers, who have more options and more buying power, and could take more time to decide on their future home, coinciding with a slowing in median selling times.
One-bedroom flats in Leith sold in the highest volumes, increasing 25% year-on-year; this hints at more first-time buyers in the market or investors looking to secure a property in one of the city’s hotspots
Dunfermline was the area with the most homes listed for sale, however the figures were just 0.6% higher than last year, showing that there has been no material change in this area’s market. Leith had the second highest number of properties for sale, with volumes up 5.7% in this area – perhaps property owners in this postcode have been looking to maximise on the impact of the new tram extension launched in June.
Selling times slow overall as buyers become more cautious
Overall, properties in Edinburgh, the Lothians, Fife and the Borders had a median selling time of 19 days during May-July 2023. This is six days slower year-on-year, again showing that the market is slightly cooler than it was last year, and buyers are behaving more cautiously when it comes to purchasing property. With more choice in the market, this could also be the reason for slower selling times, as buyers take longer to consider their options rather than bidding quickly to snap up a home.
Two-bedroom flats in Bonnington sold the fastest overall, with a median selling time of 11 days – this is 13 days faster than during May-July 2022.
There was also a reduction in the percentage of properties going to a closing date, meaning buyers could avoid the bidding frenzy for properties. During May-July 2023, 28.6% of homes for sale went to a closing date, down from 37.9% the year before.
What does it all mean for the property market?
Paul Hilton, CEO of ESPC, said: “The start of summer is traditionally a quieter period for the property market, and along with the current financial climate, the figures from ESPC’s latest House Price Report are not unexpected.
“We would expect to see buyers behaving more cautiously, and considering their bids even more carefully than before, so the data showing a steadying of the average selling price, as well as slower selling times, fewer closing dates and a reduction in the amount that buyers are bidding over Home Report is aligned with this. It’s clear to see that the market is holding well and while the frenzy of the past few years has slowed, the market is still performing very well overall.
“It’s a positive sign that there are still areas available for first-time buyers to secure homes under the LBTT threshold, and that there is strong sales data for one- and two-bedroom flats in areas like Leith, Bonnington, Dunfermline and Gorgie. We want to see more first-time buyers in the market, and when you look past the headlines, and dive into the data, there is still much to be positive about for those beginning their property journey.
“If you’re thinking about buying or selling a home in Edinburgh, the Lothians, Fife or the Borders, contact your local ESPC solicitor estate agent.”
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