It is the first time since early 2008 that the Glasgow Solicitors Property Centre quarterly market report has recorded two consecutive quarters of positive house price inflation. Sales in the first three months of the year were also sharply higher than in the same quarter a year ago, although selling times have lengthened further.
Prices remain volatile with sharp falls followed by significant rallies according to Professor Gwilym Pryce of Glasgow University, whose analysis forms the basis of the report. And some of the increase in sales is partly the result of sellers coming to terms with lower prices.
Although prices now are higher than a year ago, by 1.6%, they dipped slightly in the first quarter of 2012. The dip was not enough, however, to entirely reverse a recovery in prices at the end of last year.
The average selling price today is just over £131,000, above the £129,000 recorded in early 2011, but below the £133,000 average selling price at the start of 2012. Prices are now just over 12% below their peak in mid 2007.
The results also reveal a divide between Glasgow, Scotland’s largest city, and the surrounding areas. Selling prices and selling times in Glasgow are both up on a year ago. In contrast, outlying areas have seen a fall in both prices and selling times.
The former is typical of sellers digging in their heels and holding out for their desired price. The latter suggests sellers coming to terms with market conditions and moderating their expectations on price to achieve a sale.
Despite the overall increase in selling times in the west of Scotland overall, sales recorded by GSPC are sharply higher than for the same time last year, although transactions remain well below historical levels.
Sales through GSPC members in the first three months of 2012 were over 15% higher than the same time last year. This may be partly due to greater realism among sellers, but also reflects greater optimism and a new mood of decisiveness among buyers.
Commenting on the results, Professor Gwilym Pryce said: “While overall the picture looks positive, the results remain mixed. The medium-term prospects for house prices in the West of Scotland are probably brighter than they have been for some time, but mortgage lending remains frugal and public sector spending cuts continue to bite.”
