David Alexander

The letting firm has analysed data which shows that the number of advertised properties on the Scottish market has fallen by 22.3% over the last five months with the largest fall of 36% in Perth to a decline of just 4% in Aberdeen.

The number of properties advertised fell by 35% in Glasgow; 28% in Edinburgh: was 23% down in Dundee; 18% lower in Stirling; and had a 12% reduction in Inverness.

The Scottish market saw the number of properties advertised on the market increase substantially following the raising of the threshold for land and buildings tax (LBTT) in July with volumes peaking in November. There were six consecutive months (from September 2020 to February 2021) recording the highest monthly volumes of advertised properties achieving levels not previously reached since mid-2016.

David Alexander, joint chief executive officer of apropos, commented: “There was an expectation that volumes would rise following the relaxation of LBTT, but few would have assumed that the number of properties advertised for sale would have risen by so much over such a short period. The reduction in stamp duty also fuelled peoples’ desire to get the best home they could to match their changing needs in the post pandemic world. The sharp fall since November highlights the cliff edge caused by the March 31st deadline as buyers and sellers clearly felt demand was being driven by the lower stamp duty tax liability.”

“Given that Scotland has not followed England with an extension of the stamp duty holiday through to September it is likely that we will see continued falls in advertised properties over the next few months. Whilst volumes in England are likely to stabilise due to the Chancellor’s Budget extension the same will not be true in Scotland where we will experience an unfair period of six months as people buying in Scotland face a substantially higher tax burden on property purchases than their English counterparts.”

Mr Alexander concluded: “There is little doubt that the stamp duty holiday was a positive, popular and effective response to the pandemic. It produced the required stimulus for the property market at what would otherwise have been a difficult time. However, it has also highlighted that there is a need to review all property tax in Scotland to produce a more coherent, stable, and fair means of taxing the market.

“In Scotland it stimulated demand and increased revenues for the Scottish Government which must surely be a sign that the existing tax system is flawed and in need of immediate review.”