Edinburgh and Lothian house prices: How they have changed in the first three months of the year

House prices in Edinburgh and the Lothians have risen again in the first three months of the year, it has been revealed, amid the ongoing housing crisis.

ESPC revealed the latest market data for the first three months of the year, as it also revealed the number of sales had dropped to “more normal levels".

It revealed that the average property selling price across Edinburgh, the Lothians, Fife and the Borders rose 3.3 per cent year-on-year during January-March 2022, to £267,941, while sales volumes were down 21.6 per cent, and new property listings rose 2.1 per cent.

The ongoing rise in prices will add to the growing concern over affordable housing in the Capital.

Paul Hilton, CEO of ESPC.

Paul Hilton, CEO of ESPC, said: “In the first quarter of 2022, we’ve seen an interesting comparison to the same period last year, when Scotland was impacted by the second national lockdown. Even though property sales and associated activities were permitted at that time, naturally the market was under higher pressure and moved at a different pace, so we must bear this in mind when we look at this year’s figures.

“We’re continuing to see signs that the market is calming down following the frenzied activity of the past two years, as well as signs of rising interest for out-of-town areas. With life almost back to normal, and many buyers settled into new lifestyles, we can see that there is still very strong demand for homes outside of the city centre that offer great transport links, where a larger property is more affordable for many.

"Areas such as West Lothian and Midlothian are seeing significant leaps in demand, while we’re continuing to see strong interest for East Lothian and East Fife – regions which have both thrived throughout the past two years. And of course, there seems to be no stopping the desire for family homes in some of Edinburgh’s most sought-after suburbs.

“Dunfermline once again offers excellent opportunity for buyers on a budget, and it’s encouraging to see rising sales for flats in Edinburgh, with more first-time buyers stepping into the market. Many areas of the city are seeing increasing sales of one-bedroom flats, and Leith continues to be incredibly popular."

ESPC March House Price Report.

Average house prices rose in many out-of-town areas

Average selling prices rose in many out-of-town areas, with significant increases seen in West Lothian and East Fife. In West Lothian, the average selling price jumped 42.7 per cent year-on-year, taking the average from £198,762 to £283,678. The change in prices is due to a larger number of higher-value properties selling in this quarter compared to the same time last year, when higher volumes of lower-value properties were more prevalent. A higher number of insertions in this area across January-March 2022 also show that this area is currently performing strongly and is in high demand with buyers, so it’s no surprise to see prices rising in line with this.

East Fife has enjoyed continuing popularity throughout 2020 and 2021, and this shows no signs of slowing in 2022, with the average selling price rising 26.5 per cent to £309,417.

By contrast, the average property selling price in the 2021 hotspot of Dunfermline dropped 6.1 per cent during January-March, to £182,173. The most affordable property through Edinburgh, the Lothians, Fife and the Borders could be found here, as one-bedroom flats in Dunfermline sold for an average of £90,702, making it a great option for first-time buyers.

There was no change in average selling prices in Edinburgh city centre, but in the north west suburbs, prices rose 21.7 per cent, taking the average there to £299,480. Houses in the capital were still in high demand; three-bedroom houses in Cramond, Barnton and Cammo experienced a 31.6 per cent increase, with an average selling price of £508,033, while three-bed houses in South Queensferry and Dalmeny rose 21.6 per cent to £288,936.

One-bedroom flats in Abbeyhill and Meadowbank proved popular, as the average selling price for this property type saw a 17.1 per cent increase to £179,712, in a strong sign of demand returning for city properties for those starting out.

Buyers paid higher over the Home Report valuation across all areas

Throughout Edinburgh, the Lothians, Fife and the Borders, rising competition saw buyers paying increasing amounts over Home Report valuations, with all regions experiencing a rise in the levels paid. During January-March 2022, properties achieved 105.9 per cent of the Home Report valuation on average, 3.7 percentage points higher than the same time last year.

Some 33.6 per cent of homes went to a closing date during this quarter, up from 26.7 per cent last year, which may have influenced the amounts over valuation buyers were willing to offer.

Buyers paid the most over Home Report valuation for properties in East Lothian and East Fife, where the average amount paid was 107.7 per cent, an increase of 3.9 percentage points and 5.2 percentage points respectively, showing how strong demand continues to be for homes in these locations.

The biggest leap in the amount of Home Report valuation achieved was for homes in West Lothian, where a 5.8 percentage points rise meant buyers paid 106.6 per cent of the valuation on average.

In Edinburgh, all areas saw an increase in the amount of Home Report valuation paid, but the highest amount was seen in East Edinburgh, with properties achieving 107.2 per cent on average, up 5.1 percentage points. The highest demand was for three-bedroom houses in Cramond, Barnton and Cammo, where buyers paid 114.9 per cent of the valuation on average, up 11.3 percentage points year-on-year.

Homes sold faster as competition heated up across all regions

The median selling time of properties across Edinburgh, the Lothians, Fife and the Borders dropped by seven days year-on-year during January-March 2022, to 18 days. However, this is comparing a period of ‘normal’ activity to January-March 2021, when the second national lockdown was in place, and the market moved differently to accommodate restrictions.

Homes sold the fastest in Midlothian and West Lothian, with a median selling time of 13 days – 9 days and 11 days quicker respectively. Along with the data on selling prices and amounts over valuation paid, this clearly evidences increasingly strong demand for homes in these regions.

The biggest change in selling times was seen in East Fife, where the median selling time dropped by 17 days, to 20 days, while three-bedroom houses in the Midlothian town of Gorebridge sold the fastest overall, with a median selling time of just nine days.

Properties in Edinburgh sold six days quicker year-on-year, in a median time of 21 days. Homes in the south west of the city sold in 13 days, 19 days faster than the same time in 2021, and three-bedroom houses in Cramond, Barnton and Cammo continued to be popular, with their selling time reducing by two days to a median of 11 days.

The biggest change in the capital was for two-bedroom flats in Portobello and Joppa, where the median selling time dropped by 24 days to 15 days. This was closely followed by two-bedroom flats in Marchmont and Bruntsfield, with a 23-day reduction taking the median to 22 days, and one-bedroom flats in Polwarth, Shandon and Tollcross selling 22 days quicker, in 27 days.

One-bedroom flats went under offer at a slightly slower rate year-on-year, especially in Abbeyhill and Meadowbank, at 26 days (six days slower) and Dalry, Gorgie, Slateford and Chesser at 28 days, four days slower than last year.

Sales volumes decreased year-on-year as the market began to calm, while insertions rose

January-March 2021 was a particularly frenzied time for the housing market, and one year on, there are signs of the market activity beginning to return to more ‘normal’ levels. During January-March 2022, sales volumes across Edinburgh, the Lothians, Fife and the Borders decreased 21.6 per cent year-on-year, taking the levels closer to those that in early 2020, pre-pandemic.

Two-bedroom flats in Leith sold in the highest quantities, but the volume of these sales was down 39.1 per cent year-on-year, hinting that the particularly high demand for this area is balancing out. This was followed by two-bedroom flats in Newington; sales volumes for this property type were up 17.9 per cent in comparison to the same time last year.

Meanwhile, the volume of new properties coming to the market increased slightly, as insertions rose by 2.1 per cent year-on-year. Dunfermline had the highest volume of new properties listed for sale, but levels were down 1 per cent on those seen last year.

Edinburgh’s Trinity area has become especially sought-after post-pandemic, and it seems that homeowners in the area were particularly aware of this, as listings for homes in this area were up 61.1 per cent on the same time last year.

For more from ESPC, or to view properties currently on the market, visit espc.com.