Prices holding up
Property market ‘to fend off economic pressures’
The property market is expected to hold up (pic: Terry Murden)
A residential property lawyer expects Scotland’s housing market to remain buoyant despite concerns around the economy and calls for more government support.
Andrew Diamond, partner and head of residential property at Lindsays, said price prospects are being helped by a healthy lending environment compared to the downturn in 2008.
“This is an incredibly robust housing market,” he said. “It has been through the early implications of Brexit for the first time, the coronavirus pandemic and is now staring down the next phase of Covid, Brexit and other constitutional uncertainty, yet it remains strong.”
Looking ahead, he said: “Covid-19 is a different situation to the financial collapse in 2008, when the banks weren’t lending. They are still making money available – and at low rates of interest.
“Could the market go south significantly? Possibly. Do I think it’s going to? Probably not.
Andrew Diamond: ‘no sign of market going down’
“I think some of the heat has come out and that things will settle further, but I would be surprised if it went downwards. If there were going to be a downturn, I think we would be seeing signs of that now, which we’re not.”.
However, another property agent said at the weekend that an extension of government tax relief is needed to maintain buoyancy in Scotland’s property market.
David Alexander of Apropos says the support provided through the Land and Buildings Transaction Tax (LBTT) threshold extension has encouraged individuals to move despite uncertainties caused by the pandemic.
With the LBTT threshold extension about to end in March alongside a rise in unemployment he said there is a serious risk of the market hitting a financial cliff edge which he believes could result in a sudden fall in Scottish property values.
Mr Alexander, the joint chief executive officer of Apropos by DJ Alexander, said: “The fast-growing property market in Scotland has been one of the surprises of the pandemic with few predicting that it would be so buoyant over such a prolonged period.
“The LBTT threshold extension undoubtedly contributed to this boom along with buyers changed priorities and shifting housing demands initiated by reactions to the lockdown.”
Staff at Lindsays offices in Edinburgh and Dundee saw a near 50% rise in the number of homes sold between August and November compared to 2019.
The total values realised, at £98.8m, were up 77% (£55.8m) over the same period in 2019.
Meanwhile, the number of valuations the firm carried out in the same period rose by nearly two-thirds, highlighting strong levels of interest from potential sellers.
In Edinburgh, Lindsays saw a 60% rise on the year in the number of homes sold between August and November. Those properties achieved a combined value of £61m, compared to £34m 12 months earlier.
In Dundee, sale agreements were up by just over a third (36%) on the same timeframe. Total values were £37.8m compared to £21.8m.
Reflecting on the past few months, Mr Diamond added: “The numbers are quite remarkable. The period from the market effectively reopening in June through to the Christmas break has been our busiest on record.
“While demand has settled slightly, activity across the market remains high, with positives for buyers and sellers.
“Detached homes, for example, we could sell several times over as some people, who do not expect to return to full-time in-office working, look to move outside of city centres.
“The flats picture is a more balanced one and more of a buyer’s market as it adapts to those same changes.”
Lindsays staff conducting viewings do so within Government rules over social distancing and hygiene requirements. Guidance documents are shared with viewers and sellers.
Before an in-person viewing can take place, all prospective purchasers first take part in a virtual viewing of a property, generally via a video tour.