EDINBURGH’S “red-hot” property market is beginning to find a balance – with premiums dropping and more homes being listed.
For the first half of the year, the number of buyers vastly outnumbered the number of homes on the market. This resulted in a huge excess demand – and homes often selling in days and for prices significantly above home report valuations.
Now, according to property experts at Warners Solicitors and Estate Agents, the market appears to be balancing out thanks to an improvement in the supply of properties to the market.
David Marshall, Operations Director with Warners, said: “The biggest factor in this change to the Edinburgh market is that more homes are being listed. At Warners we recorded a 22% annual rise in the number of homes being listed for sale between June and August.
“This had been a major issue as it created a vicious circle, as reluctant sellers frequently waited to see what was on the market before listing their own home – often finding that their options were very limited.
“There have been a few factors at play in this shift towards equilibrium. Many sellers who had delayed listing have finally taken the plunge, tempted over the line by the buoyant market of the last 18 months.
“Others are simply moving out of necessity, unable to delay any longer due to family reasons.
“Although demand is still strong, buyer activity has also dipped a little. This was inevitable given the unsustainably high levels of activity throughout 2017 and the first half of this year.”
In 2018 during the three-months of June to August, premiums paid over the home report valuation stood at 5.8%. Although still high by longer term standards, this was a drop from 7.1% on sales over the same period last year.
David added: “Looking ahead to the remainder of 2018 we would expect to see the market continue to return to a more balanced state.
“The number of homes available for sale should be higher than we saw at the end of 2016 and 2017, giving buyers a little more leverage in negotiations than they have had recently.
“This will come as welcome news, especially to first time buyers who have struggled to compete against investors in a market that regularly requires sizeable up-front premiums to be paid to secure homes.”
Warners operates three property centres in Edinburgh and is one of the capital’s leading estate agents for property transactions.
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