The Calm Before The Storm

Recent statistics published by ASPC in conjunction with the Aberdeen University Business School have shown a promising trend. The most significant factors in the report show that;

• The quarterly house price change in Aberdeen City and Suburbs is +3.4%
• The annual house price change in Aberdeen City and Suburbs is +3.2%
• The annualised house price change over 5 years in Aberdeen City and Suburbs is +0.4%

Since 2014/2015 this is the first time that all indices have been positive.

Sellers have experienced a difficult time in the North East, primarily due to the industry decline, but since the “Covid months” there have been signs of a gradual improvement. We have experienced a strong upturn on Mid/Upper Deeside and even in the city, where traditionally flats have been very hard generally to sell. We have noted what are hopefully the “green shoots” of a recovery as we have seen a return to the City of contract oil workers and families with a requirement, once more, for leased properties. The “buy to let” market in the last 6-12 months has been stronger that it has been for some time.

What, however, might the future hold for our North East property market over the next couple of years? The Bank of England are raising interest rates again in an attempt to try and tackle soaring inflation. Whilst this is “better” news for savers, it could potentially add thousands to the annual mortgage cost for a normal household, with the prediction that house prices nationally will drop over the next couple of years as home owners find it increasingly difficult to make ends meet.

We may be perhaps more fortunate that most here in the North East than in other parts of the country. Whilst Edinburgh, Glasgow, Inverness and the West of Coast of Scotland have all enjoyed a very buoyant market over the last few years, prices in Aberdeen and the Shire have until recently either dropped, or at best, been stagnant. With the price of oil high once again, oil companies are returning personnel to the North Sea in quite significant numbers. It is just possible that we may be slightly more sheltered from the predicted property downturn than the rest of the country.

Whether or not we can weather the forthcoming storm remains to be seen, but we are fairly confident and will watch with interest to see which way the wind blows…