Edinburgh's housing market is so buoyant it would take a 1930s depression to make a real dent in demand – John McLellan
If Edinburgh’s planning geniuses are relying on a market crash to control housing demand, it would be pretty heartless to wish misery on hundreds of people because they are in a hole, but it’s also forlorn.
It’s true that economic recession and higher mortgage rates will depress demand, but if there is to be a sustained downturn next year, no forecasters expect it to be as deep as that which followed the banking crash, and the impact on Edinburgh property markets will be minimal.
From the end of 2008 and into the autumn of 2009, average Edinburgh house prices fell by around 12 per cent, but demand very quickly picked up and within a year or so, patterns were pretty much back to normal.
But what is striking is the steady slump in the number of properties advertised for sale since 2010-11, which explains why prices and rents have gone through the roof, and thanks to lack of supply will continue to do so, despite what might happen next year.
According to the Edinburgh Solicitors Property Centre, Lothian sales volumes fell 4.3 per cent in August-October, but average prices in Edinburgh rose 9.5 per cent to £316,152, including a 17 per cent hike in one-bed Meadowbank flats to £189,890.
It would have to be a depression worse than the 1930s to make a significant dent in Edinburgh housing demand, and Edinburgh Council needs to accept its brownfield-only policy is inadequate to meet demand. Until it does, affordability will remain a crisis.