Prices and sales up in the Scottish prime country house market
Prices and sales in the prime country house market in Scotland improved in the second quarter of 2018 and the trend is set to continue, according to the latest index report.
Prices increased by 1.2% from April to June and annual growth reached 1.6%, the strongest since the end of 2014, the data from the Knight Frank analysis shows.
The report says that overall an imbalance between supply and demand continues to underpin prices and prime values have been rising now, albeit modestly, for four consecutive quarters.
Knight Frank’s analysis of listings data from Rightmove reveals that so far this year 25% fewer homes valued above £750,000 have been put up for sale across Scotland compared with the same period in 2017.
Above £1 million the fall was slightly less pronounced at 23% and this is despite sales evidence from the Registers of Scotland which confirms a strengthening in demand for prime property.
There was a 29% year on year increase in the volume of sales above £750,000 over the 12 months to March 2018, for example, while agents note that strong prices have been achieved amid competitive bidding in some cases.
According to Oliver Knight, research associate at Knight Frank, a pick-up in prime sales is largely a result of a release of pent-up demand from buyers who, following a few years of fairly static price growth, are now more accepting of the higher rates of LBTT.
He pointed out that as a result, some rural property markets in Scotland look increasingly good value and increasing activity at the top end of the market has also helped boost Scottish government tax revenue, with recent figures from Revenue Scotland showing a notable uptick in LBTT receipts from the £750,000 plus market.
‘Prime markets in Scotland, especially in rural areas within commuting distance of city hubs, are being perceived by buyers as offering value in comparison to many markets in the UK and this is expected to continue to drive demand and pricing this year, though growth is expected to remain modest,’ he explained.
‘An imbalance between supply and demand looks set to continue throughout 2018 with no signs so far of a significant increase in the amount of stock that is set to come up for sale.
As a result, agents note that market conditions currently favour sellers,’ he added.