The total value of the residential sales market in Scotland from 2007-08 to 2016-17 was just over £143.4 billion, according to a new report published today by Registers of Scotland (RoS).

The fifth annual publication of RoS’ 10-year property market report details the trends in the land and property market over the last ten years, from the pre-financial crisis period in 2007-08, through the subsequent economic downturn, to the latest trends in sales volumes and prices up to 2016-17.

RoS business development and information director Kenny Crawford said: “The Scottish property market is a significant component of the Scottish economy. In 2016-17, the total value of residential sales alone was £16.7 billion, an increase of 1.0 per cent when compared with 2015-16.

“We’ve also seen an increase in average house prices over the decade, up 7.7 per cent when comparing 2016-17 with 2007-08. Overall, house prices remained relatively stable across each year of the decade, with the exception of a more pronounced year on year increase between 2013-14 and 2014-15.

“While the 100,291 residential sales in 2016-17 remains down on the 149,145 sales recorded in the pre-financial crisis period in 2007-08, volumes in 2016-17 were the highest since 2007-08 and have been increasing year on year from the 10-year low of 70,510 in 2011-12.”

RoS’ property price statistics are compiled using data collected as part of the land registration process. This data is comprehensive, covering transactions across the whole of Scotland for all types of property sales, in residential and non-residential markets, and with actual sale prices, not just valuations. The statistics in the 10-year property market report cover values, volumes and prices in the different sectors, broken down by local authority area. For the housing market, the report provides an overview of trends in cash and mortgage-financed sales volumes, the market within Scotland’s seven cities, sales of properties within new-build developments and trends by house type.

Further key findings revealed in the report over the last 10 years include:

• new-build property sales accounting for 12 per cent of the all-Scotland sales in 2016-17, with a total of 12,014 sales
• a 36.2 per cent decrease in the number of residential properties sold for over a million pounds when comparing 2007-08 with 2016-17, although this should be seen in the context of a drop of 32.8 per cent in total sales volumes between these years
• a drop of 30.3 per cent in the number of sales being registered with a mortgage when comparing 2007-08 with 2016-17
• the proportion of residential sales being registered with a mortgage falling from 84.5% in 2007-08 to 69.0 per cent in 2016-17
• a market value of £4.1 billion for non-residential sales (includes commercial, land, agriculture and forestry sales) in 2016-17
• a 5.3 percent increase in the volume of commercial leases, from 905 in 2015-16 to 953 in 2016-17

The 10-year property market report is free to download from the property statistics section of the RoS website.

Ryden has issued its latest detailed analysis of the Scottish Property market.

Our 80th Scottish Property Review looks at office, industrial, retail & leisure and investment property trends over the past six months, and how external factors such as weak economic expansion and ongoing political uncertainty have impacted the commercial property market.

Office property in Edinburgh has seen market demand continue at a good pace, with strong demand from Technology, Media and Telecommunications (TMT) which accounted for 26% of total take-up. In Glasgow demand has been a little more subdued at this point in the market cycle. There is better news for Aberdeen where demand is starting to recover in line with rising oil prices bringing confidence back to the city.

Industrial property demand in Scotland’s central belt, especially for units of good quality, continues strongly and the development market is now responding with a number of projects completing or on site. Despite this there is still an insufficient choice of modern premises to meet demand or to attract inward investment. In Aberdeen the industrial property market is still experiencing challenging conditions and is not yet benefiting from the oil price increase which has seen office property transactions increase.

Retail & leisure property experienced an increase in demand in 2016 but this has not been sustained as consumer expenditure has weakened. The only operators who are notably looking for expansion opportunities are coffee shop chains and budget supermarkets, while high street banks continue to dispose of branches. The sector remains focused on prime streets, malls and retail parks. Ryden’s prime retail index, covering Scotland’s top 20 shopping locations, has broadly kept pace with retail price inflation since 2013 but has stalled in 2017.

Investment property continues to be affected by political uncertainty. That said there have been some notable sales across Scotland in recent months, particularly in Edinburgh. Aberdeen has also seen investor activity begin again. Investor focus is on undoubted rental income through strong tenants, prime locations and long leases. At the smaller private investor end of the market, political uncertainty has been largely ignored and demand is strong, fuelled by low interest rates and the perceived risk of a stock market correction
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Commercial property market outlook in summary:
• Economic growth in Scotland is forecast as moving from 1.2% to 1.4% for 2017 to 2019 (source: Fraser of Allander Institute).
• Glasgow and Edinburgh office demand is stable but high quality supply is tightening.
• Strong prime industrial demand is now triggering speculative development in key areas.
• Retail is facing multiple challenges but prime locations remain strong.
• The forecast for investment returns is 3.2% in 2017, 4.3% in 2018 and 5.8% in 2019 (source: Investment Property Forum Consensus).

The full report is available to download on Ryden’s website: http://www.ryden.co.uk/advice/knowledge/scottish-property-reviews

Commenting on the labour market statistics for April 2017, released today by the Office for National Statistics, Suren Thiru, Head of Economics at the British Chambers of Commerce (BCC), said:

“With unemployment continuing to fall and employment levels rising, conditions in the UK labour market remain robust.

“However, labour market indicators often lag behind the wider economy and it remains likely that employment growth will start to soften over the near-term, as more subdued economic conditions and the rising cost of doing business in the UK stifle firms’ ability to recruit. The BCC’s Quarterly Economic Survey shows the proportion of firms reporting recruitment difficulties remains close to a record high, which is undermining their productivity and growth.

“With increases in regular pay slowing again, earnings growth is now comfortably trailing behind inflation. If the disparity between pay and price growth continues to increase as we predict, household spending is likely to slow further, weakening overall economic activity.
“The next government must do more to close the skills gap, including improving the transition from education to work by guaranteeing universal experience of work in all schools for under 16s, and delivering a future immigration regime based on economic need, rather than an arbitrary migration target. This will help firms compete on the global stage, boosting UK productivity and growth.”