0arket riefing...Midlothian West Lothian Renfrewshire North Lanarkshire Fife £282k average new...
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The Scottish New Build market is a crucial component of the wider housing market, contributing 10% to 13% of sales across Scotland and in excess of a third of sales in some council areas. Over the past few years, the New Build market has delivered increasing supply, with 2018 recording the highest level of new build sales in a decade. This confidence to green light projects has been the result of rising market conditions and demand for new housing after a number of years of low supply. This undersupply has driven strong price growth, especially in popular urban neighbourhoods. Edinburgh City Centre has notably experienced this price inflation, now averaging over £550/sqft. In Glasgow, regeneration and gentrification through development are materially changing many neighbourhoods and this trend looks set to continue, especially in the City Centre. New Homes Market Review Autumn / Winter 2019 Market Briefing Building on Demand Andrew Meehan Associate Director Key Findings • The new build market accounts for around 10- 13% of sales in the Scottish market every year. • The average new build price is around 48% higher than the average 2nd hand home. • New build apartments command the highest premium over 2nd hand stock, with premiums increasing to c.75% across Scotland in 2018. • The number of new build sales reached their highest point in a decade in 2018, with sales in Q3 2019 ahead of the same period last year. • The average new build house price across the Edinburgh and Glasgow housing market areas is £282,000; achieving £240/sqft. • Developments in the Edinburgh and Glasgow housing market areas have averaged 4.4 sales per month over the past year. www.rettie.co.uk CALA Homes at Jordanhill Park
Transcript of 0arket riefing...Midlothian West Lothian Renfrewshire North Lanarkshire Fife £282k average new...
The Scottish New Build market is a crucial component of the wider housing market, contributing 10% to 13% of sales across Scotland and in excess of a third of sales in some council areas. Over the past few years, the New Build market has delivered increasing supply, with 2018 recording the highest level of new build sales in a decade. This confidence to green light projects has been the result of rising market conditions and demand for new housing after a number of years of low supply. This undersupply has driven strong price growth, especially in popular urban neighbourhoods. Edinburgh City Centre has
notably experienced this price inflation, now averaging over £550/sqft. In Glasgow, regeneration and gentrification through development are materially changing many neighbourhoods and this trend looks set to continue, especially in the City Centre.
New Homes Market Review
Autumn / Winter 2019
Market Briefing
Building on Demand
Andrew MeehanAssociate Director
Key Findings• The new build market accounts for around 10-
13% of sales in the Scottish market every year.
• The average new build price is around 48% higher than the average 2nd hand home.
• New build apartments command the highest premium over 2nd hand stock, with premiums increasing to c.75% across Scotland in 2018.
• The number of new build sales reached their highest point in a decade in 2018, with sales in Q3 2019 ahead of the same period last year.
• The average new build house price across the Edinburgh and Glasgow housing market areas is £282,000; achieving £240/sqft.
• Developments in the Edinburgh and Glasgow housing market areas have averaged 4.4 sales per month over the past year.
www.rettie.co.uk
CALA Homes at Jordanhill Park
Autumn 2019
www.rettie.co.uk
Scottish New Build Market
The Scottish New Build market usually accounts for around 10% to 13% of all residential sales in Scotland in a year, making it a significant element of the housing market. In certain areas of the country, new house building can contribute a far higher percentage; in East Lothian, in 2019, over 1/3rd of house sales were new homes.
In 2018, the number of new build sales reached its highest level in the past decade after a strong close to the year. In the year to date, new build sales have outperformed the previous year. However, anecdotal evidence and preliminary market analysis suggests housebuilders are seeing a slowdown in visits to sites and a more mixed Autumn market.
This weakening sentiment in the late Summer / Autumn market has seen price growth slow and some developers introduce greater incentivisation to maintain sales rates. However, this is not uniform across the market, with traditionally desirable and more affordable locations continuing to find sustained demand.
£250k
£200k
£150k
£100k
£50k
2004 2007 2010 2013 2016 2018
Ave
rage
Hou
se P
rice
New Build£244k
2nd Hand£165k
Price growth has slowed in 2019Average New Build Price versus Average Price of All Sales
Sales Volumes peaked at their highest level in a decade in 2018Count of New Build Sales
2019 had an active April and SeptemberCount of New Build Sales by Month
2019 sales levels are above 2018Cumulative Sales Volumes by Year
25k
20k
15k
10k
5k
0kCou
nt o
f New
Bui
ld S
ales
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Jan Feb Mar Apr May Jun Jul Aug Sept
1,600
1,400
1,200
1,000
800
600
400
200
0
12k
10k
8k
6k
4k
2k
0k
Jan Feb Mar Apr May Jun Jul Aug Sept
Cou
nt o
f Sal
es b
y M
onth
201720182019
Cou
nt o
f Sal
es b
y M
onth
201720182019
Source: Registers of Scotland
12,21411,88011,10310,32410,0058,5927,8037,5807,9408,671
13,713
19,10417,281
14,76213,379
80%
60%
40%
20%
0%2004 2006 2008 2010 2012 2014 2016 2018
Perc
enta
ge D
iffer
ence
Apartments command the strongest new build premiumAverage New Build Price versus Average Price by Type
Apartment75%
Terrace41%
Semi Detached14%
Detached 12%
Source: Registers of Scotland Source: Registers of Scotland
Rettie & Co.
www.rettie.co.uk
Edinburgh & Glasgow New Build Market Areas
The New Build housing market of Scotland’s two largest cities and their commuter belts account for over 70% of new build value sold in Scotland each year.
Across this region, around 75% of all new build homes are family orientated, with the remaining quarter comprising flats. Over 2018/19, the average house price has been around £280,000 and £240/sqft.
The strong demand in family commuter locations within the hinterlands of the two cities has supported an average sales rate of around 4.4 homes a month over 2018/19.
While the majority of sales are concentrated under £250k and £250/sqft, there is wider range in values across the region. Edinburgh currently leads the market, with sales averaging over £300/sqft and rising to over £700/sqft for prime apartments. Edinburgh City Centre now averages over £550/sqft. Glasgow City, with its more diverse range of new build housing, has averaged over £230/sqft, with prime sales achieving over £400/sqft. Elsewhere in the region, there is a clear hierarchy in the commuter belts where accessibility, local amenity and schooling are central to driving average values.
£240/sqftaverage £ per sqft
in 2018/19
1,188sqft average unit size in
2018/19
4.4 sales average development
sales rate per month
30%
20%
10%
0%
Cou
nt o
f Sal
es b
y M
onth
£100k £200k £300k £400k £500k £600k £700k £800k £900k £1m
Average House Price in Q3 2019
Edinburgh is the main market commanding sales over £300/sqftDistribution of New Build Sales by Price Bracket
12%
10%
8%
6%
4%
2%
0%
Cou
nt o
f Sal
es b
y M
onth
The majority of sales in Central Scotland occur under £250/sqftDistribution of New Build Sales by £/sqft Rate
£100 £200 £300 £400 £500 £600 £700
£400k
£350k
£300k
£250k
£200k
Ave
rage
Hou
se P
rice
There is a clear hierarchy in the commuter belts of Scotland’s two main citiesAverage House Price vs Average £/sqft by Region
£180 £200 £220 £240 £260 £280 £300 £320
Average House Price in Q3 2019
Average House Price in Q3 2019
Edinburgh
Glasgow
East DunbartonshireEast Renfrewshire
East Lothian
Midlothian
RenfrewshireWest Lothian
North Lanarkshire
Fife
£282k average new build
sales price 2018/19
www.rettie.co.uk
Rettie & Co.
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