Christine Campbell, Your Move managing director in Scotland, comments: “Home sales in Scotland have flourished in March, coming into full bloom with a 21% upswing from February. This short-term boost in sales has been fertilised by the flurry of buy-to-let and second home buyers, eager to purchase before the introduction of the 3% surcharge on Land and Buildings Transaction Tax (LBTT) in April. The growth has ensured that this has been the strongest March for property sales in eight years.
However, Scotland’s sales did not rocket at the same rate as those south of the border, which soared by 60% month-on-month in March. The more modest increase in Scotland may have been due to John Swinney announcing the changes a month later than George Osborne, so many second home buyers may not have had time to plan their investments. But Scottish sales for the first quarter of this year are still well above the same period in 2015, up 18% year-on-year.
Midlothian is the mainland area which has seen the highest growth in sales over the first three months of the year, jumping 48% on Q1 2015. The construction of new homes in Midlothian has enabled the area to become the only place in Scotland where house prices stand at a record high in March.
The Scottish housing market has now thawed from the winter frost, bouncing back from February’s 1% dip in property values. March has seen steady regrowth in house prices experiencing the fastest month-on-month upswing since August 2015. This has allowed homeowners to smell the roses, with average property values rising by 0.8% (£1,400) during the month to reach £169,379.
While house price growth is down year-on-year, it’s important to remember that this was due to the huge spike in house prices back in March 2015, following a rush of sales brought forward to avoid the introduction of the LBTT. But with buy-to-let landlords opting to buy flats and other more affordable properties, this hasn’t translated into too much price turbulence. House prices have generally risen by between 0.01 and 0.8% each month since July 2015, which suggests the current spurt is healthy and sustainable.
It is an uplift in million pound home sales which has propelled East Renfrewshire up the rankings in March, with house prices in the area increasing faster than anywhere else in Scotland, accelerating 8.1% month-on-month. These additional high-end home sales mean the area now also has the highest average property value of any area at £257,529.”
