What’s Happening in the Scottish Property Market and Property Prices – MOV8 Real Estate June 2013 Update

What’s Happening in the Scottish Property Market and Property Prices – MOV8 Real Estate June 2013 Update

This month is usually the month of the year when estate agents around the country breathe a huge sigh of relief after the usual Spring rush of property sellers looking to get their properties onto the market. They will usually put their feet up, look out the window and wonder why it’s still 12 degrees outside and raining, then hope forlornly that a few of these houses will sell so that they can go away somewhere nice and warm at a time when flight and hotel prices are at their highest and their chances of swimming a lap of the swimming pool without having a small child dive-bombing on them are at their lowest.  So, is that what has happened this past month?  We’ll start as always with our analysis of the month of property news in the Press before moving on to let you know what we have personally been seeing happening in the property market. So here goes before I jump on a packed £600 Ryanair flight to an airport two hours from my final destination…

This Month’s Property News, as Reported in the Press

Things are on the up! A report from the Royal Institute of Chartered Surveyors (RICS) revealed that house prices rose to their highest level for more than three years to the end of May. The survey is  only of estate agents who are also surveyors (and there aren’t many of them in our area) but nevertheless they reported an average of 17.9 sales per branch which, whilst still below the figures during the height of the market in 2007, suggests that sales are indeed on the up. The survey works on a system of asking these surveyor/estate agents (who account for some of the largest chains in the UK) whether they think that prices are going to rise, fall or stay about the same.  It then takes a net balance: do more think they are rising than falling?  This month, 35% more surveyors who were (erm) surveyed believed that figures would continue to rise over the next three months than the proportion of surveyors who believe they will fall, an increase of 26% on the previous survey.

This is of course good news. RICS statistics tend to hugely influence market confidence, something that has been missing since the house market crashed in 2008 and of course it is surveyors, in Scotland, who produce the Home Reports (containing a valuation of the property) that have a huge bearing on the asking and eventual selling price of properties.  Put simply, if they are confident and a touch bullish, it is good news for the health of property prices.

Nationwide Building Society also released a report claiming that the property market was ‘gradually gaining momentum’. The survey reported a 1.01% growth in prices up until May 2013.

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Urging caution though, these are UK-based statistics and the ‘regional’ statistics (Scotland being a ‘region’) don’t necessarily look quite so positive.  What has to be borne in mind is that there are areas of Scotland where property prices are certainly not rising and, quite the opposite, they are falling with sellers struggling to sell their properties.  Scotland is really quite divided at the moment when it comes to the overall health of the property market.  Edinburgh and Aberdeen certainly seem to be in rude health when compared with some of the smaller towns surrounding them.  As always, I’d suggest if you want a good picture of what is happening, you remember that the property market is very local, particularly at the moment, and that you take advice from an estate agent who is an expert in your local area.

Nevertheless, the UK statistics do indicate a greater confidence in the housing market and perhaps a greater availability of funding for buyers which can only help to maintain the health of the market wherever you live in Scotland.

What Have We Been Seeing Happening in the Property Market This Month and How Can You Maximise Your Chances of Selling?

After a fantastic April and May I honestly expected to see a bit of a reduction in activity this month. This is usual for this time of year – the schools break up this month and so many prospective buyers and sellers jet off to sunnier climes. We have also learned in the last few years to take nothing for granted in the property market and it seemed that three great months on the trot might just be a bit too good to be true.  However, it turns out that this pessimism was misplaced and that the market has continued to roar along.  Okay, it’s NOTHING like the peak of the market a few years ago and it continues to be a tough slog in many cases to get properties sold, but it’s all relative to four years ago.

We have thus far seen a very slight decline in the amount of sellers signing-up to sell their properties with us when compared with May but this is to be expected at this time of year. However, it seems that a relatively late spring and increasing confidence in the market has mitigated the sort of drop-off we would normally expect in seller activity at this time of the year.

We have also seen another record month in terms of properties sold.  Considering that the number coming to the market is naturally tailing-off, it is fantastic to see that the percentage of properties we are selling versus putting on the market is actually going up.  At the end of the day, that’s our job, and it’s amazing to see the number of sales going up the way it has.

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And it’s not just us (though of course I’d love to be able to say that it was!).  Across the board, we are seeing more and more For Sale Boards with ‘Sold’ signs on them.  We are also hearing from other firms that we are speaking to that they are experiencing an upswing and that they haven’t been as busy for a while.  It’s not just in Edinburgh and the Lothians either: firms we have been speaking to in the West of Scotland have also been reporting a consistently higher level of activity for the last few months.

With an afternoon still to go this month, it looks like we are on track to beat our own company’s personal best, which is NOT what I’d expect in June of any year.  As always, of course, amongst all the positive news there are still plenty of houses and flats that aren’t selling.

The same old boring advice applies here (if you are in need of a broken gramophone, I’m available for hire!).

Sometimes it just takes a bit of time: the average time it takes to sell a flat or house (if it actually sells) is about four months – we have seen properties this month that have been on the market for upwards of a year selling without any additional advertising or a price-drop.

It’s of course important that your flat or house is presented as well as possible: if not all properties are selling, you need to make sure that yours is amongst the best examples of its type in the area.  And of course, probably most importantly, your house has to be priced correctly.

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If you’re doing everything that you can to maximise the chances of your property selling (great photos, great advertising materials, widest-possible exposure of your property on the internet advertising channels available, ‘staging’ your property as well as possible for viewings, not doing anything at a viewing to put potential buyers off buying it, proactive agent with a database of buyers who are being informed of your property when it comes on the market), and you have waited a sufficient amount of time (it sometimes does just take a bit of time, as above), then the only real solution is to drop the price a bit to make it more attractive versus the competition.

Property sellers really have cause to be worried if prices are tumbling, funding is unavailable and we end up with a paralysis in the market like we did a few years ago.  However, when property prices are stable, mortgage availability is increasing and criteria are improving for buyers, and properties are selling in increasing proportions, by following the simple advice above you really should get the result that you (and of course we!) want.

I hope that you find some of the content of this update useful or interesting and, as always, if you have any comments please do leave them below!

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I'm Robert Carroll, Managing Director of MOV8 Real Estate, Estate Agents and Solicitors. MOV8 is an innovative and forward-thinking estate agency and solicitor firm with its Head Office in Edinburgh, UK. It is one of the fastest growing firms in the east of Scotland. I see first-hand every day what is actually happening in the property market and am regularly quoted in the Scottish Press in property stories. Through this blog I aim to give an honest, fresh and sometimes light hearted take on what is happening in the Scottish property market for anyone who is interested in that kind of thing...

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