Is now a good time to buy?

The answer, broadly speaking, is yes.

There! Who says lawyers never give a straight answer. No need, if you are pushed for time, to read any further.

Except, buying a property is a very significant lifetime event, and there is that worrying “broadly speaking” in the answer. Perhaps you should read on?

At the time of writing – March 2023 – our local housing market is coming out of its winter torpor and gearing up for the most active months of the year. What can we expect? Well forecasts are difficult to make, with any accuracy, so I will refrain. What can be done is look at where we have come from and where we are, and it may be possible to discern a line of travel.

Our local housing market has tended to be out of step with Scottish national trends, for a long time, due to the energy industries. Originally oil and gas only, renewables now, play a part, and the war in Ukraine has concentrated minds on energy self - sufficiency. Additionally, decommissioning work in the North Sea is set to continue for a good many years. The contribution of energy related companies will continue to be a substantial part of our local economy.

Just how influential a factor was seen early in the second decade of this century, when a contraction in offshore industry caused a slide in prices from a peak in 2014. The recovery from that has taken until now, and there are still some areas with challenges. There is a problem, still, with certain types of properties, and some flats prove difficult to sell. It is the case, however, that careful preparation and planning for sale, including decluttering, staging, and, in difficult cases, some home improvement, will work very much towards a successful sale.

Over the last 5 years, our market has stabilised in most areas, and has begun to show convincing signs of a return of modest growth in house prices. The quarterly statistics, prepared by the School for Real Estate at The University of Aberdeen, using data supplied by ASPC, demonstrate the gradual improvement over the last 5 years. (You can find the information here)

Evidence of this can be seen in several ways. We are now seeing consistency in price. Over the last two years we have seen the gap between selling price (lower) and Home Report valuation (higher) narrow to the extent where, on average, houses are selling at or very near to valuation. Of course, there are individual exceptions, but the general trend is clear. There are more closing dates being fixed, well presented properties are selling quickly in some areas, and there are sales at above home report valuation.

This is all better news for sellers and buyers. Stable markets allow sellers and buyers to deal on a reasonable basis, with the balance between the two classes more or less equal.

Housing markets are mostly driven by confidence. Will I still have a job in 5 years’ time? Will my wages increase? Will mortgage rates rise? Everyone faces some doubts and concerns, and,  just at present there are some grounds for caution. The general economic situation, the war in Ukraine, post Brexit blues, the political situation, and inflation with its effect on mortgage rates.

Short term, these can all affect housing markets. Medium to long term they have less impact. When mortgage rates increase, there can be a lull in activity, but, eventually, people acclimatise to the new reality, adjust plans, and carry on. Just at the moment, mortgage rates are, really, where they should be in a “normal” economy.

Buying a home is one of the most important decisions in our progress through life. Housing is a necessity, but it can also be a life enhancer. Deciding when to buy should not only involve financial considerations. If the time is right for life reasons, then let that be a significant factor in your decision - making process, too.

ASPC is passionate about helping buyers, renters and sellers across the North East move home. From the initial discovery of a property, right through to moving in, our team has created a range of insightful blog posts and information pages that will provide some helpful tips to make your move as simple and efficient as possible. 

If you have any questions, please get in touch with one of our team members on centre@aspc.co.uk.