Despite property prices falling slightly further, activity in the housing market of the Aberdeen area points to signs of a recovery in some locations. A more stable local economy has helped buyer confidence. The combined annual number of transactions across both Aberdeen and wider Aberdeenshire has now held firm at around the 8,000 level over the last four years.

Local markets

Aberdeen’s recovery has extended to its prime market above £400,000, which recorded a 5% annual increase in the number of transactions in 2019. The AB15 postcode district, which includes the West End and suburbs of Cults and Bieldside, outperformed with a 12% annual rise in prime activity last year. Further afield, areas within easy reach of Aberdeen City, including Ellon and Inverurie, lifted Aberdeenshire transactions annually by 2%.

Demand remains strong

A 41% annual rise in the number of buyers registering with Savills in the North East during 2019 reflects the increased demand for the Aberdeen area’s prime housing stock. A 29% increase in viewings also suggests that activity in the prime market will continue to improve, provided sellers maintain realistic price expectations.

Outlook for prices

Price falls of 2.5% across the city and the surrounding county in 2019 reflect the high number of available properties, primarily below £200,000. Despite more realistically priced properties being launched, there are currently over 5,000 properties available to buy across the market as a whole compared to 2,500 before the downturn.

We expect price drops to ease in 2020, as stock levels begin to reduce. This should enable a recovery from 2021, underpinning our forecast for 3.5% price growth over the five-year period between 2020 and 2024.

Angus and Dundee area

Supported by an economic boost, fuelled by the V&A Museum and new railway station, Dundee’s residential market saw a 2% and 4% annual rise in the number of transactions and average price respectively. This was led by increased second hand and new build activity in locations around the universities and also towards the western parts of the city near Ninewells Hospital. Transactional growth also continued in the traditional hotspot of Broughty Ferry, which dominates Dundee’s prime market.

Increased prosperity emanating out of Dundee has fed growth in Angus, led by its coastal locations. The residential market in southern Kincardineshire, across both the mainstream and prime sectors, also witnessed a recovery over the last year.

_{Read the articles within Spotlight: Scotland Residential below.}