It is too early to tell whether the latest headlines regarding a second Referendum on Scottish Independence is likely to impact the market, but there is certainly a sense of déjà vu in the air north of the border.

No market likes uncertainty and while the first vote in 2014 took a while to impact the property sector, there was a definite slowdown in the final stages of the debate. However, we have since seen a General Election, a Scottish Election, the EU Referendum and a new President in the US yet the market in Scotland has continued to grow, both in terms of level of transactions and price.

We’ve witnessed an upturn in the number of buyers moving here from south of the border and overseas, with Scotland remaining the most searched for term on our website. Indeed, the devaluation of the pound and subsequent favourable exchange rates for international buyers is providing a boost to the UK market. It appears that a degree of election fatigue is at play and that quality of life and exceptional value for money trump politics when it comes to buying decisions: we anticipate ‘business as usual’ for the Scottish market for some time ahead.

The number of residential sales in Scotland last year was 9 per cent above the 10-year annual average, and in fact we are seeing our strongest market in almost a decade north of the border. In addition, Scottish property attracted more top-end buyers from outside Scotland.

An imbalance between growing demand and lack of supply in central hotspots is fuelling price growth, which is now filtering through to Scotland’s heartland of Tayside, Stirlingshire and Fife. Both prices and transactions have recovered in more rural locations where the market is now stable. Meanwhile a reduction in selling times across Scotland’s cities, and exceptional off-plan sales within the new build markets of Edinburgh and Glasgow, are resulting in supply constraints.

According to Savills Research, transactions and prices across Scotland increased by 3 per cent and 3.5 per cent respectively in 2016 despite the Brexit vote effect, a drop in mortgage lending and a slowdown in the Aberdeen area. It will be interesting to see whether that upward trend continues in light of recent political announcements.

Certainly we can expect buyer sentiment across the UK market to remain sensitive over the next few years as the process to leave the EU unfolds and the Scottish Independence question is resolved one way or another. While we do anticipate a slowdown in value growth in the coming years, characteristic Scottish prudency and realistic pricing is likely to drive a continued recovery in transactions over the next five years.

Further information

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