Price recovery continues

Price recovery continues

Prime property prices increased by 0.3% in Q4 2013, according to Knight Frank’s Prime Scottish Property Index.

The strong second half of the year means prices for Scotland’s best properties have risen by 1.6% on an annual basis. However, prices remain 24% below the market peak in Q4 2007.

Price performance in the final quarter of the year was mixed across Scotland. Prices rose or were unchanged during the quarter in six out of the seven main Scottish regions, with a 1.3% rise in the Central region the biggest increase.

The analysis of market activity over the final three months of 2013 confirms a more positive picture has emerged, with the number of sales agreed during the quarter 10% higher than the comparable period last year. The number of individuals registering their interest in purchasing a prime property in Scotland was up by over 50% over the same period, as were the number of viewings conducted.

In 2013, the appetite among buyers for sub-£1m homes in key regional towns was strong and increased activity from buyers has had a knock-on effect on prices at this level. Indeed, sub-£1m homes increased in value by 1.8% in the fourth quarter, outperforming the wider prime market.

Ran Morgan, head of Knight Frank’s Scottish residential department, said: “As evidenced by
rising prices and an increase in transactions, the second half of 2013 has marked the start
of a turnaround in fortunes for the prime Scottish country house market.

“It is encouraging to see that this recovery is taking place in rural as well as urban areas.
Rising prices across almost all the regions is reflective of the more positive mood we have seen among both buyers and vendors.

“The coming year is likely to throw up its own unique challenges, with the referendum on independence scheduled to take place in September. We remain confident that the recovery in transactions and prices seen during the second half of the year will carry on into 2014 as the Scottish economy continues to strengthen.”

According to the Knight Frank/Markit House Price Sentiment Index, households in Scotland
are more confident that the price of their property will rise over the next 12 months than at any time since April 2010.