It means that residential property prices in the city have increased by 3.4% on an annual basis and the New Town and West End areas of the city enjoyed the greatest growth over the three month period, with homes here increasing in value by 2.1%.
But it drive and interest in the sub £1 million property sector that is proving to be the main driver in the city and properties in this price bracket increased in value by 2.3% in the fourth quarter of 2013.
The report says that the rise in property prices this year is a result of the increased demand for well located homes in the city’s established residential areas which has led to a subsequent increase in sales.
There was a 22% rise in applicant volumes in the city compared to the previous quarter, and a 13% increase in the number of property viewings over the same timeframe. The report points out that this increased demand has translated into a jump in the number of sales.
‘The number of transactions completed in the three months to December was 47.4% higher than the previous three month period and more than double that of the fourth quarter of 2012, an indication that we are seeing a return a more fully functioning housing market in the city,’ said Edward Douglas-Home, head of city sales in Knight Frank’s Edinburgh office.
‘There is definitely a renewed sense of confidence in the Edinburgh market among both buyers and vendors which has translated into a significant rise in sales this year. We are now seeing a return to normal healthy transaction levels,’ he explained.
‘Demand is particularly strong for good quality flats in the city centre and smaller family houses worth between £300,000 and £800,000 across the popular areas of the city. Such properties in New Town and the West End are attracting much attention when they come to the market,’ he added.
But he also pointed out that above £1 million the market is a little slower. ‘While deals are still being completed at this level, there are fewer buyers willing to commit,’ he said.
Indeed, a more detailed examination of the data confirms this, with wide variations in terms of price performance depending on the value of a property. Over the last three months, sub £1 million properties have increased in value by 2.3%.
In the £1 million to £1.5 million price bracket, properties increased in value by 0.8% in the fourth quarter of 2013. Price growth for properties in the higher price brackets has been more muted in comparison and the price of homes worth £1.5 million plus were unchanged over the quarter although Douglas-Home added that activity levels remain healthy in this sector.
