Edinburgh & Lothians Property Market Report: April 2019
House buyers and sellers have been out in force in Edinburgh and the Lothians during the first quarter of 2019 as homemovers continue to show few signs of being deterred by the prospect of Brexit.
Between January and March, Warners Solicitors & Estate Agents recorded over 250 property sales. That represented an annual increase of over 40% compared to the same period in 2018 and was the highest level on record since the ‘credit crunch’ in 2008.
Activity among sellers was also seen to have increased substantially. Warners brought almost 300 properties to the market in the first quarter of 2019 - up by well over 30% compared to the first quarter of 2018. Again, this marked the highest level of activity on record since 2008.
Throughout 2016 and 2017 there was a significant shortage of homes for sale across Edinburgh and the Lothians. This led to a situation where there were typically multiple buyers competing for each home for sale in Edinburgh. As a result, buyers often found themselves having to bid well in excess of the Home Report valuation in order to secure a property.
In 2018 the number of homes coming onto the market started to show steady improvement, with Warners observing an 11% rise in the number of new property listings compared to 2017. Supply has improved further still in the first quarter of this year with more sellers willing to take the plunge and get their home onto the market.
Because of the improvement in supply, pressure has eased on property buyers. As a result, the premiums that buyers are now having to pay are lower than they have been in recent years. In the first quarter this year the average premium paid over the Home Report valuation to secure a property was 3.4%, down from 6.9% in the first three months of 2018.
Commenting on the results David Marshall, Operations Director with Warners said: “There had been a feeling that activity in the local property market would be subdued in the early part of the year as people were expected to wait and see the outcome of Brexit negotiations before deciding to buy or sell. This has not been borne out in reality.
"The rise in the number of homes coming onto the market that we have seen has been the greatest improvement that we have seen in the market over the last two years. In 2016 and 2017 many people were having to delay selling their own home because they couldn’t find a property that they wanted to buy. As more homes have become available it has made this problem far less common. Buyers are more often able to find a home that they want and most sellers are able to sell their properties quickly.
"With the pressure on buyers having eased, house price inflation has also come back down to more manageable levels. Latest figures from ESPC show that the average house price in Edinburgh rose by 1.8% annually during the first quarter, well below the rate of inflation observed during 2017 and 2018.
"The levels of inflation that we are now seeing are much more sustainable over the longer term so this is good news for the health of the market and, as we move forward, we would expect to see inflation continue in the region of 1-3% for much of 2019."