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Scotland sees strongest buyer growth yet picture reversed south of the border

Written by : News | Fri 20th Feb 2015

A new report showed that the housing market in Scotland and Northern Ireland showed growth last month, although it cooled off in England and Wales.

The Royal Institution of Chartered Surveyors (Rics) has stated that the housing market across the UK is shows a “very mixed picture”.

49 per cent of surveyors in London reported prices falling, recording the most negative price growth in the capital for six years in January.  It was Central London which drove the majority of house price growth across the country last year.

Scotland witnessed the strongest buyer interest with surveyors suggesting that the new land and buildings transaction tax, which will replace stamp duty in Scotland, will encourage more first time buyers into the market.

Meanwhile, Northern Ireland showed the strongest price increase, with 47 per cent of surveyors there reporting price rises.

Scotland followed closely behind with a net balance of 38 per cent of surveyors reporting price increases.

In Wales, 18 per cent of surveyors reported seeing price rises.

Rics suggested a "multitude" of factors were having different impacts across the UK, with political uncertainty being a strong factor.

It said the recent stamp duty reforms announced by the UK Government were already providing a boost in regions such as South West England and Scotland.

There were also wide variations on the supply side of the market, with the supply of homes for sale remaining tight in North West and South East England, while in the South West of England more properties had become available in recent months.

Rics said that across England and Wales, there were signs of a cooling market as well as price growth having "all but levelled off".

In London, a balance of 24 per cent of surveyors expected prices to fall further in the capital over the next quarter.

Despite the different opinions, surveyors remain optimistic with 48 per cent expecting the number of house sale transactions to increase during the next 12 months.

Strong competition between lenders offering low-rate mortgage deals would help boost activity, Rics suggested.

The strength of the housing market recovery, during the first half of the year, took many commentators by surprise.

However by the middle of 2014 there were signs of a more cautious mood.

Experts have suggested that the referendum on independence in Scotland disrupted housing market activity as people awaited the outcome.

Figures from the Office for National Statistics have shown that house prices in Northern Ireland, still have some way to go to reach the levels they were at before the financial crisis happened.

Simon Rubinsohn, chief economist at Rics, said: "There remain a number of challenges to the market, such as ongoing affordability constraints, lack of stock and an air of caution in the run-up to the general election."

By Kim Traynor (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons


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