The number of houses sold in Scotland increased by 6.5% compared to the third quarter of 2014. A total of just over 28,000 properties were submitted for registration between July and September 2015. While it is interesting to see activity increasing in the Scottish property market it was a little surprising to see the average property sale price fell slightly to just over £169,000. So, what can we ascertain from increased activity in the Scottish property market and is this a turning point after a difficult period?
Where is the increased activity happening?
While we await confirmation of the total value of properties sold between July and September 2015 we now know that the figure for the second quarter of 2015 increased by six percent to £4.74 billion. It would seem there is growing momentum within the Scottish property market even though the average selling price, as we touched on above, has fallen slightly to just over £169,000.
This report by Registers of Scotland tells us that West Lothian saw the highest increase in sales volume rising by 23.1% over the corresponding period. The actual highest number of properties sold occurred in Edinburgh with a 9.6% increase to just over 3500 individual sales. This corresponds with the largest property sub-market in Scotland with Edinburgh turning over just over £800 million worth of property in the quarter.
Property type trends
There would appear to be increased demand for semi-detached house with the value of this type of real estate increasing by 2% to just under £160,000. Over the whole of Scotland this was the only type of property which showed any price increase with detached properties down by 0.9%, the value of terraced properties falling by 3.1% and flats showing a 2.4% reduction.
At the same time as this encouraging report on the overall Scottish property market it was also revealed that Glasgow and Edinburgh are attracting particular interest. Indeed some estate agents have reported that properties are changing hands at up to 15% above their valuation price. Again, this would seem to indicate underlying demand even if the growing trend has not yet impacted the average price of property across Scotland.
Areas of concern
It will come as no surprise to learn that Aberdeenshire, areas of which depend heavily upon the oil industry, saw sales volume down by 13.5% and a reduction of 16.6% in overall sales value. There is growing concern that the troubled oil sector will have a detrimental impact upon the area for some time to come. Some experts are predicting only a partial recovery in the price of oil to around $60 per barrel which is nearly half of the $100 plus level oil was trading at just over 12 months ago.
Even though it must be frustrating for the Scottish property market to see an increase in volumes but no increase in actual property prices, this could be a turning point. It would seem that there have been a number of properties overhanging the market across some areas of Scotland which have depressed prices. As and when this overhang disappears we should see positive growth in the value of the average Scottish property. When this will occur is unclear but the signs are certainly more positive than they were just a few months ago.