- House prices 5.6% up on last year
- Selling times fall to lowest figure since 2008
- Rise in homes coming on the market
House prices in Glasgow and the west of Scotland rose by 5% in the last three months while selling times plunged. The average selling price rose to £126,000 while time on the market fell by almost 20% compared to the same time last year. Properties are now selling faster than at any time since autumn of 2008 (see graph).
Despite the strong rise in prices over the last three months, annual house price inflation (the change in prices over the last 12 months) actually dipped to 5.6% (from 7.2% in April) as earlier falls in price dropped out of the calculation. Nevertheless, average selling prices today are over £6,500 up on the same time last year.
There are also signs that sellers are now more ready to move, helping to ease the shortage of new homes coming on the market. Until recently, the surge in sales that started last year had not been matched by new supply, prompting competition among buyers in some areas with limited stock. Over the last three months, however, there has been a marked improvement in new instructions and 11% more properties came on to the market in the last 12 weeks than was the case over the same period last year.
According to Professor Gwilym Pryce of Glasgow University, who analysed GSPC’s sales data: “The most striking feature of the results is the fall in average selling times compared with quarter two last year. This constitutes the fourth year in a row when there has been a pronounced reduction in quarter two average selling times. The average number of days it takes to sell a home in the West of Scotland now stands at 73 days, less than half the time it took to sell a house in 2011, and the lowest quarter two figure since 2008.
“Despite recent price rises and falls in selling times, it would be more than a little premature to say that the housing market in the West of Scotland is overheating. These results should be interpreted as evidence that the housing market is enjoying a healthy recovery rather than as signs of an emerging bubble”.
Certainly, falling selling times, moderately rising prices and a rise in the number of homes being put up for sale are all welcome signs of an improving market. Early summer is a vital time of year for the property market and what happens now sets the tone for the rest of the year, so we would hope to see that improvement continue.
But it’s important to put this recovery into context. House prices today in the west of Scotland are still, on average, 12% below their peak. And sales are still significantly below their long-term average. It will take a good deal more improvement before we can say that the market has recovered.