Written by Felicity Forbes-Davidson, Director, Aberdeen Residential

Having reached the end of the first month of 2023 it appears that the economic changes experienced in Q3/Q4 2022 are having a lingering effect on activity in the local property market. Confidence builds on activity and vice versa. A more important question is, what are the positives in the current market and where are the opportunities for sellers, purchasers, and investors?

The most recent figures published by the Aberdeen Solicitors Property Centre show that the market performed consistently throughout Q4 2022. The annualised house price change across Aberdeen City over the last five years in Q4 is +1.2%, indicating prices being achieved have remained stable. What is notable is that in Q4 2022 there were 1,177 properties transacted on the APSC, which is well down on Q4 2021.

The number of residential properties for sale on Aberdeen Solicitors Property Centre currently sits around 3500, which is the lowest level we have experienced in the last five years. Almost half of these are flats, and therefore, the supply of houses is even more disproportionately low. There are still transactions occurring and the sales achieved are generally at stable prices, with some particularly desirable properties still outperforming the rest of the market. What is becoming apparent is that economic uncertainty is making sellers apprehensive about marketing their properties for sale. Conversely, newly marketed properties are experiencing good levels of interest and consistent sale prices. Now is a good time to consider marketing your property to take advantage of this.

The measures introduced in September 2022 by the Scottish Government to protect tenants in the Private Rented Sector have received a lot of comments in the media. There are still some excellent opportunities for buyers entering the buy to let market. Supply of rental property is exceptionally low, far below the level of demand, and consequently the rentals being achieved have risen significantly in recent months. Equally, the historic availability of flats in recent years in Aberdeen has kept the prices at a very affordable levels. Purchasing a buy to let property offers the potential for a strong return on investment.

Prices for flats also present an excellent opportunity for first time buyers. Historically the buoyant market in Aberdeen made climbing on the property ladder a challenge, if not an impossibility, for many first time buyers. Often these purchases would be facilitated by parents or high loan to value mortgages as the prices were so high. However, housing both in, and across Aberdeen city and Shire are much more affordable.

In challenging times, affordability is a greater factor. There is little doubt that our market offers good opportunities for purchasers and investors alike. The overall limited supply provides an excellent chance for sellers to achieve a quicker sale at a decent price. The market needs new listings to meet the demand from prospective purchasers.

For any further information or advice, or indeed if you are considering selling your home and require a Home Report, please contact our Aberdeen office on 01224 594172, where one of our surveyors will be more than happy to help.

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