Seller confidence hit by Brexit in east central Scotland - ESPC

The report, covering the three month period from April to June 2016, has shown that just as the pound value dropped immediately after the result on 24 June, there was a significant dip in the number of properties brought to the market, as well as Home Report requests, which are the first step before a seller puts their property on the market.

However, this appears to have been a temporary reaction as sellers processed the surprise outcome, and looking into the first few days of July, ESPC said there had been a recovery in the number of properties coming up for sale.

The estate agent also pointed out that there tends to be a decrease in housing market activity over the summer months as people go on holiday.

The report showed that in the last three months prior to the EU referendum, sales volumes were down by 5.6 per cent across east central Scotland compared to the same period last year.

ESPC said the decrease can be attributed to a decline in the number of properties available to buy that has been seen since last year.

Average selling prices across east central Scotland have increased by 6.3 per cent year on year, with the median selling time 43.3 per cent faster when compared to the same three month period a year ago. This indicates that we are still in a sellers’ market, encouraged by the shortage of properties for sale.

As was revealed in last month’s house price report, two-bedroom flats in the Portobello and Joppa areas of Edinburgh are still in high demand, with a 30 per cent year-on-year increase in average selling prices. The average selling price of three bedroom homes in Liberton and Gilmerton have increased by 23.2 per cent, while one bedroom flats in the Leith area are continuing to see strong growth.

ESPC’s business analyst Maria Botha-Lopez said: “In the weeks and months leading up to the referendum, there didn’t seem to be any clear effect of the campaign on the housing market, which was adjusting to the new Land and Buildings Transaction Tax (LBTT) supplemental tax. However, with the unexpected outcome, there was a dip in new properties for sale and Home Report requests the week after Brexit, but this appears to have been a temporary reaction as the number of new listings is beginning to build up again.

“It is still too soon to tell what the housing market in the post-Brexit landscape will look like, with immediate effects seeming to be a ‘wait and see’ or ‘wait for the dust to settle before proceeding’ for those who were not already in the middle of a property transaction. There have been very few reports of buyers or sellers pulling out of transactions, with most proceeding as planned.

“It’s hard to tell what proportion of the decreases we are seeing are related to the general supply shortage trend or a natural caution towards political uncertainty. The second homes tax that was introduced in April could also have an effect, as home buyers purchasing a second home would have to think about raising that extra 3 per cent to add onto the purchase of the property.

“The fundamentals remain unchanged however, and with housing being a necessity and mortgage availability seemingly unhampered, the buyer demand is still there.”