NEW research has revealed that higher mortgage interest rates appear to be impacting the Scottish housing market.
Respondents to the latest Royal Institution of Chartered Surveyors (RICS) Residential Market Survey reported lower levels of sales and buyer enquiries last month.
A net balance of -23% of respondents in Scotland said sales fell in the October survey, while a net balance of -17% of respondents reported a fall in new buyer enquiries.
More positively, a net balance of 26% of Scottish respondents expects sales to increase over the next three months, suggesting underlying demand is good.
House prices are also continuing to edge upwards. A net balance of 27% of respondents in Scotland reported that prices rose in the most recent survey, and a net balance of 14% anticipate prices will increase over the next three months.
Richard Clowes MRICS of Graham & Sibbald Property Consultants Ltd in the Scottish Borders and north Northumberland, said, “External factors continue to have an impact on the wider economy and confidence generally. Realistically priced property continues to sell.”
Greg Davidson MRICS of Graham + Sibbald in Perth added, “Political uncertainty has caused some hesitation to property markets, and this is likely to exacerbate a traditional winter slow down. Underlying conditions are quite stable which should benefit the market in 2027.”
Commenting on the UK picture, RICS head of market research and analysis, Tarrant Parsons, said, “Home buyer demand remains subdued, and respondents are bracing for a weaker year ahead for sales given the persistent macroeconomic challenges being faced. In accordance with this, the Bank of England’s rate rise was accompanied by a clear warning that policy may need to tighten further if higher energy costs feed through into wider prices. With inflation now projected to approach 5% next year, mortgage rates are likely to remain elevated for longer, thereby continuing to weigh on the market.”
