March Property Market Update

Property Market Highlights

• Average house prices in Scotland hit £187,000 with certain areas still providing strong growth 
• Certain areas still buoyant despite economic landscape, including, Dunfermline, Leith and Musselburgh
• Despite certain headwinds property prices remain strong with 80.7% of properties achieving 103.6% of their valued worth
  

Properties Across Central Belt & Borders Rose 2.2%, Hitting £277,326

According to the latest data from the Land Registry, average house prices in Scotland hit £187,200. Meanwhile, ESPC recorded noticeable growth in areas across the central belt and the Borders, with house prices reaching £277,326 between December 2022 and February 2023 – a 2.2% rise year-on-year, suggesting demand remains strong in traditionally sought-after locations, despite signs of the market cooling off.

West Fife and Kinross enjoyed the most significant increase in house prices over the last month, recording an annual average selling price of £219,292, a 15% growth. Next up, The City of Edinburgh saw a boost of 2.3% to £293,096, with two- and three-bedroom properties proving to be the most popular with buyers. In Morningside and Merchiston, two-bedroom flats were all the rage, with average selling prices hitting £395,673, a 16% rise, while in The Shore and Granton, the same property types sold for an average of £236,414 – a 9.4% increase.

Lastly, demand for two- and three-bedroom homes were also high across Corstorphine, Clermiston, South Gyle and East Craigs – where average prices grew a whopping 17.5% year-on-year according to ESPC, hitting £394,698. In Blackhall, Davidsons Mains and Silverknowes, average prices for the same property types sat at £492,888, a 10.1% increase.

Certain areas still buoyant despite economic landscape

ESPC’s latest data report suggests the recent economic unrest, the cost-of-living crisis and higher interest rates are beginning to take their toll on an, up until now, mostly unscathed market as people think twice about taking the plunge to buy and sell.

New property listings across Edinburgh, the Lothians, Fife and the Borders dropped by 2.7% year-on-year, while sales volume decreased by 19.7% annually, suggesting those on both sides of the market are cautious and waiting to see how the unstable economic situation continues to pan out.

However, some areas were remaining buoyant – particularly outside city centres. For example, Dunfermline, Leith and Musselburgh enjoyed a boost in new property listings between December and February this year, with increases of 26.3%, 24.6% and 20.4%, respectively. Moreover, several locations in the Borders saw a 13.4% increase in new properties coming to the market, with a 125% gain in Galashiels and an 11.8% climb in Peebles. 

Following trends we’ve seen in recent property updates, this may well be linked to buyers seeking larger, more affordable properties further afield in light of more flexible working conditions.

Property prices remain strong with 80.7% of properties achieving 103.6% of their valued worth

Again, continuing trends we’ve seen in previous updates, buyers across Scotland continue to pay over and above Home Report valuations at sale, with 80.7% of properties achieving 103.6% of their valued worth. Comparing data provided by ESPC, we can see that only 73.5% of properties from December 2018 to February 2019 (before the COVID-19 pandemic) achieved 102.4% of their Home Report valuation at sale, highlighting the level of competitiveness visible in today’s market, even amidst the current climate. 

Some areas have experienced a slight slow down with East Lothian properties attaining an average of 105.7% of their valuations (a 3.9% drop compared to last year), while East Fife homes earned 105.2% (a 2.5% decrease). Next, properties in the City of Edinburgh enjoyed 103.5% of their valuations at sale (a decline of 1.6%). 

This is welcome news for buyers who have witnessed properties selling for upwards of 10% of their Home Report valuations at sale in the past year alone. Buyers will no doubt benefit as their money goes further on each purchase.

Overall, the theme we see in the latest property report is one of a market beginning to feel the effects of an unsteady economy. As figures across all market elements show gradual signs of returning to pre-pandemic levels, many potential buyers and sellers may feel wary in making a move. ESPC’s CEO, Paul Hilton, however, feels optimistic:

“The spring market is expected to be busy, and there are promising signs that the market is currently continuing to outperform the pre-pandemic levels and other parts of the UK. This highlights once again that there is no ‘one market’ and local knowledge and insight are imperative if thinking about buying or selling.”

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