Edinburgh & Lothians Property Market Report: January 2019
The final quarter of 2018 brought some festive cheer for house buyers in Edinburgh and the Lothians. There was a sharp rise in the number of homes coming onto the market, offering buyers more choice after almost two years during which the number of homes for sale was seriously constrained.
In the final three months of 2018, Warners brought 159 properties to the market for sale. That’s up 42% on the same period in 2017 and marks an increase of over 60% on the number of homes listed for sale in the fourth quarter of 2016.
A shortage of homes for sale in Edinburgh and the Lothians was a consistent feature of the property market throughout 2017 and during the first half of 2018. This led to a situation where there were typically multiple buyers competing for the properties that were available, meaning that buyers often needed to offer well above the Home Report valuation to secure a home.
The improvement in supply is therefore welcome news for buyers and its impact can be seen when we look at the average premiums that are being achieved relative to the Home Report valuation. During the fourth quarter of 2018, the average premium paid to secure a home stood at 4.0%. Though still a relatively high figure by historical standards, this marked a notable decrease from the figure of 5.5% observed during the final three months of 2017, indicating that buyers’ negotiating position has strengthened.
Turning to buyer activity, the number of homes sold during the fourth quarter rose, with Warners observing a 15% annual increase in the number of homes sold between October and December. The rate at which demand is rising is lower than the rate at which the supply of homes to the market has improved however, leading to a more favourable market for buyers than was seen earlier in 2018.
Commenting on the latest results David Marshall, Operations Director with Warners said: "During the second half of 2018 we started to see a real improvement in the number of homes coming onto the market and this will have come as a welcome relief for many buyers who struggled to secure a home in a very competitive market.
"It’s worth noting that, whilst the supply of homes to the market has improved, conditions are still largely favourable for sellers in most areas. The median selling time for a property in Edinburgh and the Lothians is a little over two weeks and most homes are achieving prices in excess of their Home Report valuation. Nonetheless, the increase in the number of homes for sale is good news as it should lead to a more balanced market in 2019 and bring house price inflation down to more sustainable levels.
"It goes without saying that the ongoing uncertainty surrounding Brexit represents the most significant downside risk to the market this year. To this point however there are few signs that this is deterring people from moving home in Edinburgh and the Lothians, with both seller and buyer activity well ahead of levels witnessed a year ago."
If you are thinking about buying or selling a property get in touch with Warners today on 0131 667 0232 or by emailing email@example.com and one of our friendly experts will be delighted to help.