It seems as though many investors are now switching on to the Scottish property market with prices increases over the 12 months to March 2015 outstripping those of the general UK and even London. Property prices in Scotland increased by 14.6% during this period with the average UK price increase at around 9.6%. London, which is predominantly the major market in the UK, saw house prices increase by “only” 11.2%, a figure which surprised many people. There seem to be a number of factors coming into consideration in relation to Scottish property.
Over the last couple of years all we have heard in the Scottish press has been about the independence referendum and the general election. There is no doubt that many investors did put investment ideas on hold until we saw the results of the independence referendum and maybe now this pent-up demand is pushing prices higher? The SNP is now in total control of the Scottish political scene and while there was much bluster as they made their way down to the House of Commons for the first time as a group, we have seen very little change so far.
It looks as though the investment markets believe that Scotland will be part of the United Kingdom for many years to come although there are many scare stories about yet another independence referendum in the short term.
In some ways it is difficult to understand why the Scottish property market is performing so well when you bear in mind that the Scottish economy is lagging that of the general UK in many areas. Again, this could be a result of the recent political shenanigans with pent-up demand perhaps set to push the economy forward in the short to medium term. However, it is also worth noting that there are various hotspots across the Scottish property market with Edinburgh always leading the way.
Those who have read our recent articles will also be well aware that there is renewed interest in Scottish seaside property investments which have performed extremely well in recent times.
Lack of suitable property
There is no doubt that the ongoing rise in Scottish property prices can also be linked to a lack of suitable properties on the market. This has always been a particular problem in the more popular areas of Scotland, such as Edinburgh, and for some reason this seems to have been more prevalent of late. It will be interesting to see whether more properties come onto the market or whether indeed property owners/investors really do have a deep-seated confidence in the Scottish economy and the Scottish political scene going forward.
For many months prior to the independence referendum and the recent general election the Scottish economy and the Scottish property market attracted many negative headlines. There were serious concerns about independence including the financial situation, political arena and indeed how the long drawn out independence discussions with the UK might damage short to medium term investment. Very soon we will see whether the recent surge in Scottish property prices is purely and simply because of the “No” vote in the recent independence referendum.