Aberdeen housing market records 0.5 per cent Q1 rise

The rise was against a downward trend of a 2.9 per cent fall across Scotland over the same period.

The Aberdeen Solicitors’ Property Centre, in cooperation with the University of Aberdeen’s Centre for Real Estate Research, also found that the annual house price change in Aberdeen and its suburbs is 7.3 per cent, compared to 7.7 per cent across Scotland and 8.1 per cent across the United Kingdom as a whole.

Commenting on the figures, John MacRae, Chairman of the Board of Directors of ASPC said: “The first quarter figures for 2015 were awaited, by me, with some interest. The background to the housing market in the first quarter of 2015 was more complex than usual in that certain novel or unusual features came into play.

“The first, and novel, factor influencing the market was the well-publicised change, in Scotland, from Stamp Duty Land Tax to Land and Buildings Transaction Tax. Much had been made in the public forum, before the changeover, of the adverse effect LBTT would have on the housing market, despite ASPC’s sales figures showing that over 80 per cent of transactions were below the point where LBTT takes more than SDLT. It was noticeable that, in the last 6 months, a greater number of higher end end houses came on the market as people, thinking of moving, sought to beat the deadline.

“The second factor coming into play, which is not unknown, is the decrease in the oil price and the effect it would have on the market. As can be seen from the figures, the undoubted concern in the oil industry is not yet reflected in house prices but, there is a small decrease in volume which may indicate how the market is going to go. Because the oil companies and their employees have been here before, there is some expectation that the oil price fluctuation and its consequences will be managed. If that is so, then there is reasonable optimism that the effect of the oil price will not be as manifest as contemplated.

“The third factor that has come into play, this year, is the general election - thankfully almost upon us. The indication from the polls is that the result of the election may be too close to forecast, and such uncertainty may affect general confidence in the community until such time as we know how things are going to progress.

“For the foregoing reasons, therefore, it is all too easy to imagine our local market becoming depressed but I have some grounds for optimism that this will not happen. The fact is that the market for starter homes is still very active. Mortgages have never been so cheap and there is increasing competition to provide very attractive fixed term rates from the main lenders. Because of those factors it is likely that reasonably priced properties will still find a ready market. I am convinced that there is still demand out there for first time purchases and that this will filter up the market. There will be some effect felt from the uncertainties outlined above but I do not think we should be unduly concerned.”