The local housing market has continued to heat up as we head towards summer. At MOV8 we enjoyed our busiest ever April with the number of sales agreed up by over 40% annually. There has been no sign of things slowing down in May, with sales already well ahead of 2014 levels with a week still to go in the month.
Although the supply of homes coming onto the market has also risen, there’s no question that the balance of power in the market has swung firmly in favour of sellers. Homes are typically selling in a matter of weeks rather than months now. Indeed we have had a number of properties recently that spent less than a week on the market, with some going under offer on the same day they went up for sale.
As you would probably expect, the rise in demand has meant that buyers are typically having to make higher offers to secure the property they want. In the majority of cases homes are achieving a price equal to or in excess of the Home Report valuation. This marks a significant change from the situation a year or two ago when around two-thirds of homes were secured for below their valuation.
We are really starting to see the shift in market conditions feed through into house prices now. Figures released by ESPC showed that the average house price in Edinburgh during the three months to April stood at £245,249. That marks an increase of more than 20% on the same period a year ago – the fastest annual rise recorded by the organisation since 2002.
The National Perspective
Interestingly, at this stage house prices are rising more quickly in Edinburgh than in other parts of Scotland or the UK. According to the most recent report from Registers of Scotland, the average house price across Scotland as a whole rose by 13% annually to £173,830 during the first quarter of the year.
At a UK-level, HBOS reported that the average house price rose by 8.5% annually during April, whilst Nationwide observed a 5.2% rise during the same period. In part, the sharper increases north of the Border can be explained by the introduction of Land & Buildings Transaction Tax (LBTT) earlier this year. Under LBTT – which replaced Stamp Duty from 1 April 2015 – anyone buying a home for more than £333,000 will face a larger tax bill. This inevitably led to a flurry of sales of larger homes prior to the change of tax system, pushing the overall average house price earlier in the year upwards.
This effect will obviously be short term, and as we move forward we would certainly expect to see the rate of house price inflation come down. There’s no question though that the market just now is a strong one for sellers and we’d expect that to remain the case throughout 2015.
As ever, if you’re thinking of selling a property, please get in touch with us on 0345 646 0208 or at [email protected]. One of our team of experts will be happy to arrange a FREE valuation and pre-sale appraisal visit, or just to have a chat with you on the phone, to give you all the advice that you need to help you to get the best possible value for your property.