What do solicitor estate agents think of the current economic climate?

There has been a lot of speculation recently about how the current political and economic challenges will impact the housing market. The economy is facing a number of challenges: unprecedented changes in the financial market, an increase in the Bank of England base rate, the increasing cost-of-living and rising energy bills. All of these challenges infer that there may be a slightly different property landscape ahead. 

However, Scotland’s housing market has traditionally remained robust and feedback from ESPC solicitor estate agent member firms confirms that there is still strong interest from buyers and sellers. 

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Jamie Sole, Property Manager at Blair Cadell Solicitors, gives us his thoughts:  

“There is currently much speculation in the media about the property market. As far as Edinburgh and the Lothians are concerned, we are seeing continued resilience and activity with properties continuing to be brought to the market, and competitive closing dates being set. This continues to be driven by the shortage of properties that are available, and the sustained buyer demand for property in Edinburgh, traditionally seen as a sound investment.  

“There are still plenty of mortgage products available, and purchasers with cash that are driven to find their forever home. Whilst we have seen some properties taking slightly longer to sell and fixed prices making a reappearance in some cases, properties are still selling well. Those with garden space continue to generate strong interest and premium prices, emphasising the lack of quality stock, and illustrating demand from families looking for more space and possible work-from-home options.  

“With interest rates set to rise, we suspect that there will be a levelling out in the market as purchasers readjust their budgets and spend accordingly. This may cause properties to sell for slightly lower premiums but this should balance out in any onward purchase. In every market there are opportunities. It is important that through times of market change both purchasers and sellers seek trusted advice from their Solicitor Estate Agents who are best placed to guide and support them through these times.”

Charlotte Murray, Property Manager at Paris Steele, says: 

“There has been a lot of scaremongering regarding the market which has caused a lot of confusion and so I would highly recommend getting in touch with your local solicitor estate agent and financial advisor to find out what’s really happening in your local market and with lending.  

“Here in East Lothian, we are still seeing good demand for homes with sale prices still holding strong, we are so fortunate with the market here, as we know it’s a very desirable location so the market has always performed well and we don’t expect that to change.  

“We are starting to witness a levelling out of the market now, so we are not expecting to be seeing as many of those huge offers over valuation that we were seeing earlier in the year, more around home report or just over. However, this could make for a healthier market that is easier to navigate, as exciting as it has been to see properties selling for way over their valuations it caused a lot of homeowners to be anxious about coming to market without securing their next property first with just how fast and competitive the market has been, causing a shortage of homes being available.

"A levelling out of the market could actually encourage more people to take that leap to come onto the market, perhaps making it easier to buy and sell without fear of not securing another home or having to pay through the nose for it.” 

Edward Danks, Partner at Paris Steele, added:

"As the cost-of-living crisis continues to accelerate, house prices remain at record levels with further surges anticipated as we enter the final quarter of 2022. The Office of National Statistics (ONS) has reported that average house prices have now reached record levels in England, Wales, and Scotland. The median UK house price in July 2022, was £292,000, a staggering £39,000 higher than at the same time last year, with Scotland seeing rises of 9.9%, equating to an average house price of £193,000. 

"At a time when there is so much doom and gloom in the news, we might expect a much greater cooling effect on house prices than what these figures are showing. The pandemic created pent-up demand for bigger properties in suburban, rural, or semi-rural areas, as people sought more space and were less reliant on being close to city centre offices due to hybrid and work-from-home changes. The elevation in house prices throughout the property boom has been further fuelled by stock shortages in many areas of the country, something which has been particularly prevalent in the picturesque towns of East Lothian.

"While the current economic crisis is likely to impact mortgage rates, a sudden crash in the market is not anticipated, however, question marks remain over how high interest rates will climb."

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Expert advice is crucial 

With the cost-of-living crisis and interest rates going up, it is important that potential property buyers review their initial budgets. Expert advice from your ESPC solicitor estate agent on property types and the long-term value of home ownership coupled with monthly affordability advice from ESPC Mortgages is key.