ESPC House Price Report June 2016
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Key findings
- The number of homes sold in east central Scotland between April and June of 2016 decreased by 5.6% annually.
- The average selling price in east central Scotland between April and June of this year has increased by 6.3% when compared with the same period last year.
- The percentage of sales achieving or exceeding their Home Report valuation rose from 58.8% between April and June of 2015 to 70.2% in 2016.
- The median selling time in east central Scotland is 43.3% faster when compared to the same three-month period a year ago – from 36 days down to 20 days.
- 83.7% of properties listed between April and June 2016 were marketed as ‘offers over’, compared with 70.8% in 2015.
Brexit has resulted in caution amongst sellers in east central Scotland
ESPC, the leading property experts in east central Scotland, has released their first house price report since the EU referendum.
The report covers the three month period from April to June 2016, but has shown that following the Leave result, which took many people by surprise, there was a stall in the number of people bringing their home to market.
Just as the pound value dropped immediately after the result on 24th June, ESPC’s statistics have revealed that there was a significant dip in the number of properties brought to the market and Home Report requests - the latter being the first step before someone puts their property up for sale. This appears to have been a temporary reaction as sellers processed the surprise outcome, and looking into the first few days of July we have seen a recovery in the number of properties up for sale. It should also be kept in mind that there tends to be a decrease in housing market activity over the summer months as people go away on holiday.
In the last three months prior to the EU referendum, sales volumes were down by 5.6% across east central Scotland compared to the same period last year. This decrease can be attributed to a decline in the number of properties available to buy that we’ve been seeing since last year.
Average selling prices across east central Scotland have increased by 6.3% year on year, with the median selling time 43.3% faster when compared to the same three month period a year ago. This indicates that we are still in a sellers’ market, encouraged by the shortage of properties for sale.
As we saw in last month’s house price report, two-bedroom flats in Portobello and Joppa are in high demand, with a 30% year-on-year increase in average selling prices. The average selling price of three bedroom homes in Liberton and Gilmerton have increased by 23.2%, while one bedroom flats in the Leith area are continuing to see strong growth.
ESPC’s business analyst Maria Botha-Lopez says: “In the weeks and months leading up to the referendum, there didn’t seem to be any clear effect of the campaign on the housing market, which was adjusting to the new Land and Buildings Transaction Tax (LBTT) supplemental tax. However, with the unexpected outcome, there was a dip in new properties for sale and Home Report requests the week after Brexit, but this appears to have been a temporary reaction as the number of new listings is beginning to build up again.
“It is still too soon to tell what the housing market in the post-Brexit landscape will look like, with immediate effects seeming to be a ‘wait and see’ or ‘wait for the dust to settle before proceeding’ for those who were not already in the middle of a property transaction. There have been very few reports of buyers or sellers pulling out of transactions, with most proceeding as planned.
“It’s hard to tell what proportion of the decreases we are seeing are related to the general supply shortage trend or a natural caution towards political uncertainty. The second homes tax that was introduced in April could also have an effect, as home buyers purchasing a second home would have to think about raising that extra 3% to add onto the purchase of the property.
“The fundamentals remain unchanged however, and with housing being a necessity and mortgage availability seemingly unhampered, the buyer demand is still there.”
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