Monday, Nov 16, 2009
Edinburgh prices
Scotsman: Shock as city house prices fall 12%
Fallen by 12%. Previously Edinburgh had held up quite well. Not mentioned in this article but certainly connected, Edinburgh had previously been a banking hub, being the base for RBS and another (forgot which). HQ and staffing requirements have moved down to London. So banker bonuses no longer exist to support above median prices. High prices at the top end of the market are a strong driver of prices below. Given the dependency on Scotland on state money, Barnett formula etc, and the need for cuts in the future, it is hard to see anything other than a continuation of falls as we go into fiscal tightening, and with the targeted loss of finance jobs probably worse overall than the UK generally.
Posted by stillthinking @ 09:57 AM (1144 views) Add Comment
12 Comments
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1. little professor said...
Glasgow also down 10%
2. a saver said...
Thanks for useful post and commentary, stillthinking. Usual Scotsman bias of course, there will be plenty of people very pleased to see an Edinburgh home becoming more affordable. I've never been able to understand why prices are so high, given the low average salary there.
As someone else said a while back, the Scotsman, ESPC and offers over £XXXXXXXX system (effectively sealed bids) have a lot to answer for.
3. mark wadsworth said...
Tee hee, all good stuff, but not as impressive as Northern Ireland, where according to the BBC house prices are down by 32.1% over the least year.
4. Alfie said...
Let the collapse begin..... bring it on
5. bellwether said...
Interesting. If you haven't noted from the occasionally irascible nature, I'm Scottish. What I notice up here is that people in almost every sector have had their incomes seriously compromised. As so much of the earnings of uk employees are linked directly or indirectly to credit growth this makes sense. It also makes sense that this will impact negatively on house prices.
What we have I suppose is a perfect storm for a housing crash, and perhaps it would be better if it were a little less perfect because the Government would not then be "all in" to save it.
I see the safest course at present as being out of housing and our of sterling, because only one can be saved. I don't know which.
6. cynicalsoothsayer said...
The EAs used to brag that Edinburgh house prices only ever went up. Not any more.
"However, price movements in the latest quarter are particularly volatile. Nowhere has this volatility been more apparent than in Edinburgh."
The word volatile is a VI euphemism for falling. Is Edinburgh going to lead the way down?
7. cynicalsoothsayer said...
LOL in comments section #3:
Leslie Deans, senior partner in Leslie Deans & Co estate agents, said "The statistics say that house prices are going down but they are really going up because this is the only direction they can ever go."
8. amjidk said...
wait till the Tories get in, the real crash will probably start after the may elections......
9. Mindytea said...
We made a good offer on a house in Edinburgh today and were turned down flat. Sellers still bullish...very depressing! Just praying for a bit more negative press and some more evidence of prices falling so we can climb on the ladder at a realistic level.
10. timmy t said...
When data shows that in a 3 month period prices went down by 12% in one city and up by 13% in another city close by, I would have thought the only conclusion to draw is that there weren't enough transactions to make meaningful statements about what's going on. If you are selling a second hand Ford Fiesta, you can look it up in What Car and get a pretty accurate idea of it's value, but if you're selling a 1963 Ferrari, it's worth whatever someone is prepared to pay for it. Houses are the same at the moment.
11. stillthinking said...
Edinburgh isn't such a large place, really nice and beautiful, but not so big. This amplifies the effect of the withdrawal of finance jobs.
You can't help but wonder if this is a precursor to falls in London.
What isn't so often mentioned but is nonetheless true, when Labour hit the wall as far as extending debt is concerned, which they certainly will, all of the guarantees to the banking sector become meaningless. London will then be a centre of counter-party risk, not profit, and as Jim Rogers has suggested, the financial sector will move. Who would want to keep a financial company in a country with a supposedly socialist government desperate to raise taxation above and beyond what the population can pay? I think nobody. Maybe this will take a while.
12. doomwatch said...
timmy t. You are spot on. Most surveyors in Scotchland are clueless, especially the big ones that employ recent grads who
just scale valuations based in floor area. Bit like saying a ford fiesta is the same value as a Porsche 911, as they both have 4 wheels.