The cost of housing in Edinburgh and Glasgow will increase by 16.5 per cent and 13 per cent respectively by 2023, according to property consultancy firm JLL. This compares with a more moderate growth of 11.5 per cent expected for Scotland as a whole.
Scotland’s house price growth has risen 17 per cent in the past five years, below the increase of 31 per cent which has been seen across the rest of the UK. JLL reported that Scotland, similar to the UK-wide property market, has under-delivered on the number of homes needed to meet demand.
Properties in Edinburgh
At the end of 2018, the average sale price of a typical two-bed flat in Edinburgh city centre was £285,000, a 2.5 per cent increase on the same period the previous year. Outperforming Britain’s forecast of 2.2 per cent price growth and 2.4 per cent rental growth, Edinburgh is expected to average 3.1 per cent price and rental growth.
Glasgow property market
The Glasgow market has been characterised by an under-supply of housing for many years, particularly in the city centre. The consultancy firm attributed this to a shift in interest build-for-sale bias to build-to-rent during 2017.
In Glasgow’s upcoming pipeline, JLL suggested there are around 4,000 build-to-rent units, many of which are set to be completed by 2021 and 2022.
In Glasgow city centre, a typical new-build, two-bed flat currently has a sale price of around £226,000, a 1.8 per cent increase compared with figures in 2017. The cost of renting in Glasgow is also expected to rise by 3 per cent over the next five years, while sale prices are set to grow by 2.6 per cent.
Jason Hogg, from the firm JLL, concluded:
“The moderate growth across Scotland’s house prices are somewhat skewed by the above average performance of both Edinburgh and Glasgow, which are both set to see strong growth as limited development activity creates further discord between demand and supply.”
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