NEW research has revealed that Scotland’s housing market ended 2024 with both prices and enquiries increasing, with surveyors remaining optimistic on the outlook for the market.
The findings were revealed in the latest Royal Institution of Chartered Surveyors (RICS) Residential Market Survey.
Surveyors in Scotland reported house prices rose through the last quarter of 2024, as a net balance of 50% of surveyors noted an increase. Respondents anticipate this trend will continue through the first quarter of 2025, with a net balance of 45% expecting prices to rise over the opening months of the year.
While surveyors report that sales fell flat through the month of December, they appear to be more optimistic on the outlook, with a net balance of 45% of respondents in Scotland expecting a rise in sales through Q1 2025. A net balance of 8% reported new buyer enquiries increased through December – the third consecutive month this has been in positive territory.
Regarding supply, a net balance of 5% of surveyors in Scotland reported a rise in new instructions to sell, increasing from -6% the previous month.
Looking at lettings, Scottish surveyors report tenant demand fell flat for the third consecutive month, and landlord instructions declined for the second month in a row. However, a net balance of 20% of respondents anticipate rents will rise over the first three months.
Commenting on the sales market, Greg Davidson MRICS of Graham + Sibbald in Perth said, “The underlying market conditions should be quite good and stable for 2025 but the sales evidence post-election is still a bit limited. It is unclear yet how the increased costs and tax and the possible impact on mortgage rates and inflation could impact. There is likely to be no significant change in the short term.”
Discussing the rental market, Ian Morton of MRICS, Bradburne & Co in St Andrews added, “General lettings have steadied and there is choice for tenants. Rent increases have also slowed as supply matches demand in most sectors.”
Commenting on the UK picture, RICS chief economist Simon Rubinsohn said, “The latest results from the RICS Residential Market Survey points to a further improvement in sentiment in the housing market despite concerns about the potential impact of rising bond yields on borrowing costs. Buyer enquiries rose once again, albeit at a slower pace than in November, and the headline price indicator also moved higher.
“More significantly, the signals from the survey around expectations over the next twelve months also remain solidly positive for now. However, the resilience of the uplift in market mood could be tested if the mortgage rates do begin to climb in a material way over the coming months. That, critically, would also be a concern for developers who will want to see a solid market as a backdrop for ramping up housebuilding to help meet the government’s ambitious 1.5 million homes target for this parliament.”
