Property markets in the north-east and across the country received a boost yesterday as more positive signs of recovery were reported.
Mortgage lending in the UK this summer showed its first year-on-year growth since early 2007, it has emerged, while Aberdeen and Aberdeenshire recorded a 42% quarterly rise in house sales.
Hopes that the market had turned were tempered, however, by research from the Ernst and Young ITEM Club which claimed recent house price rises represented a “false dawn”. The group said that while the increases indicated the property market may be stabilising, the recent rise in house prices could not be sustained beyond the spring of next year.
Instead, it expected renewed price falls during the first half of 2010, followed by two years of stagnant prices, after which the cost of property would gradually start picking up. It expected it would be at least five years before house prices returned to their autumn 2007 level.
Despite the research, there was “concrete evidence” of an increase in the number of mortgages taken out by buyers in the UK. Mortgage lending this July was up 19% on the same month last year, according to the latest Council of Mortgage Lenders (CML) survey.
New Scottish Government statistics revealed the north-east continued to outperform the rest of Scotland in terms of house sales. There were 1,906 sales of homes in Aberdeen and Aberdeenshire during the second quarter of 2009, up from 1,341 in the first three months of the year.
The figures represent a 38.4% drop in year-on-year sales in the north-east, and a 43% decrease on the second quarter of 2007, but compare favourably with Scotland as whole, which recorded a 47.8% drop since last year and a 57.8% decline since two years ago.
There were other positive signs for Scotland’s property market yesterday, however, as new figures released by the Royal Institution of Chartered Surveyors (RICS) showed the number of surveyors reporting a rise in new instructions increased by 6% from July, and 33% from June. A total of 74% of those surveyed in Scotland said they had seen a rise rather than a fall in buyer inquiries throughout August – a quarter more than the UK average of 49%.
Gordon Wilson, managing director of financial advisers Thomson Shepherd, said: “There are a lot more positive signs around the property market. People are becoming more confident and with interest rates as low as they are, people are starting to make moves again.”
A survey has shown 84% of Scots believe building more affordable homes for rent should be the top priority in the next Scottish budget, housing and homeless charity Shelter Scotland said today.
It released the results to coincide with the delivery of its Declaration for Homes to Finance Secretary John Swinney. The charity is demanding Holyrood ministers fund 10,000 new affordable homes for rent.