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Property sales still increasing

New figures show that the number of property sales in Scotland is still increasing, with a 26.1% rise in the number of residential property transactions in the third quarter of 2013/14, compared to the same period in the previous year.

Registers of Scotland statistics

In total, say the latest official statistics from Registers of Scotland (RoS), 25,579 properties changed hands during the quarter. This is apparently the highest number recorded for the third quarter of a year since 2007/08.

According to RoS, the average price for a residential property in Scotland for the quarter stood at £159,670.

Geographical breakdown

The statistics also give an interesting breakdown of the property markets in different geographical areas. The figures show that:

  • The average price of a property in East Renfrewshire is now £222,906, which represents a rise of 4.8% and makes it the most expensive place to buy property in Scotland.
  • The highest number of sales took place in the City of Edinburgh, where 2,951 homes changed owners, a rise of 35%. Glasgow is in second place with 2,569 sales, a rise of 24.8%.
  • Prices rose the most in East Lothian, with a jump of 14.9% compared to previous year, taking the average house price to £209,566.
  • On the opposite end of the scale, prices fell the most in Inverclyde (8.7%), to an average price of £116,085. However, the area also saw the biggest percentage rise in sales numbers (44.2%).

Influx of first time buyers

Registers of Scotland’s Director of Commercial Services, Kenny Crawford, puts the signs of improvement down to schemes such as Help to Buy, which is encouraging first time buyers to enter the market.

Halifax House Price Index

The suggestion is echoed by Martin Ellis, housing economist with the Halifax, commenting on the mortgage lender’s latest House Price Index. This also reported some positive trends in the property market:

Between November 2013 and January 2014, house prices rose 1.9% compared to the previous three months. Prices were also 7.3% higher than they were during the same three months last year.

Activity within the property market was on an upward trend in 2013, with the number of sales going over the one million mark for the first time since 2007. In December alone, the number of sales hit 103,040, which is a 30% increase over December 2012. There was also a 9% increase in the number of mortgage approvals, which is 9% higher than the previous quarter and a 30% increase over the same quarter of the previous year.

However, there continues to be a limited supply of new properties coming onto the market, which is putting additional upward pressure on house prices. According to the Halifax, there was only a marginal increase in the number of homeowners instructing solicitors or estate agents to put their property on the market.

“With the supply of properties being slow to respond to more buoyant market conditions, stronger demand has resulted in continued upward pressure on house prices,” explained Ellis. “Demand has increased against a background of low interest rates and higher consumer confidence underpinned by signs that the economy is recovering and unemployment falling faster than expected.”

“Official schemes, such as Help to Buy, also appear to have boosted housing demand. However, continuing pressures on household finances, as earnings fail to keep pace with consumer price inflation, are expected to remain a constraint on the rate of growth of house prices,” he added.

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