Demand jumps for homes in Edinburgh but supply remains limited

• New buyer enquiries were nearly double that seen in the previous quarter and almost a third higher than in Q1 2016.
• Viewings were up by 45% year-on-year between January and March.
• However, rising demand has not been matched by a boost in supply.
• There was a 38% fall in the number of homes listed for sale across Edinburgh in the first quarter of 2017, compared with the same period the previous year.

This imbalance between supply and demand has put upwards pressure on prices, with a 1.1% increase in property values in Edinburgh over the first quarter, according to Knight Frank data. This is only the second time quarterly price growth has exceeded 1% in the last two years.

On an annual basis prices have increased by 3% on average, up from 2.6% at the end of 2016.

“Higher purchase costs as a result of changes to LBTT remain a concern, but it’s a shortage of good quality stock relative to new buyers that has been the primary driver of the market at the start of 2017.” Edward Douglas-Home, Head of Edinburgh City Sales, noted.

At the top end, this has been even more pronounced. There were 54% fewer properties valued above £500,000 put up for sale compared to the same period last year, with a 64% fall in properties priced above £750,000.

Read the full Edinburgh City Index.