Andrew Diamond, Partner and Head of our Residential Property team offers his insight into the current property market.
Andrew says picture remains ‘sticky’ with the market affected by political nerves in recent months - but that long-term signs are positive. He believes it could take until the spring for Scotland’s housing market to fully bounce back from the nervousness which was seen in the lead-up to the UK Budget.
The market across the country is described as ‘sticky’, with many having delayed venturing into it until hearing the detail of what Chancellor Rachel Reeves had to say at Westminster last month. But Andrew believes the longer term mood music is more upbeat, with the Royal Institute of Chartered Surveyors (RICS) recently describing property prices in Scotland as “firmly positive”.
Andrew commented: “There was undoubtedly a bit of stand-offishness around the Budget and what the Chancellor could do. Many people long-grassed decisions about whether to buy or sell until they had heard the detail. Markets do not like uncertainty and there was certainly that in the lead-up to the Budget which has held some people back.”
There are hopes that the Bank of England’s recent interest rate cut - down by 0.25% to 4.75% - will make mortgage deals for buyers more attractive. And, while the most recent UK House Prices Index showed average property prices in Scotland topping £200,000 for the first time, Andrew believes the market is more complex than that.
Andrew continues: “A lot of the statistics we see point to the market being fine - interest rates are coming down, demand’s still there, prices are rising steadily and no alarm bells are ringing. But the real-time picture is trickier than that.”
“People have been cautious in recent months to see how the political picture plays out. My sense is that things are starting to loosen post-Budget - and that’s true for deals generally, not just in housing. “But it might take until the spring for the market to pull away from the stickiness we are seeing.
“The flipside of that is that, for sellers, it is a good time to get on the market because competition will increase as we head towards the spring.”
The buyers in the strongest position remain those who are ready to move as soon as a deal is completed, with those trying to purchase properties subject to selling their own often finding themselves disadvantaged.
In its most recent UK Residential Market Survey, RICS, whose members are on the frontline of valuing properties, say its members are largely of the opinion that property prices will continue to rise over the next three months.
Published Tuesday 26 November 2024 and featured in the Herald on the same day.
