An Estate Agency reflection on 2024 and look ahead to 2025

The Scottish housing market has been relatively steady for this year, and although it is still adjusting to the relatively high interest rates, market trends suggest a moderate increase in activity. The exception is the new build market which continues to struggle due mostly to pressure on supply of raw materials. The rental market seems strong although there is constant speculation about the forever dynamic government legislation.

Residential sales, this year like next year will exhibit a mixture of challenges and stability, dictated as always by economics, government laws and buying/selling behavior. Cities are still in demand, but rural areas like the Scottish Borders are proving more popular, with people seeking a more tranquil lifestyle. The UK currently has a housing shortage but conversely locally there is a decent supply, and demand for new builds especially with the new March Street Mill development in Peebles proving this, with there being many pre-sale reservations.
Buying and selling is intrinsically linked with interest rates, and is directly correlated with affordability. Interest rates are heading down, which is excellent news for first time buyers and movers, but borrowing costs are hindering some investors. Rents as we know are still increasing as supply diminishes, and potential changes to the new Housing (Scotland) Bill, are both factors causing some apprehension.

There has been steady decline this year in house prices and sales volumes in Scotland, and we believe that there will be a bounce back next year, with estimations being an increase of 3/4% . However two leading companies namely Zoopla and Knight Frank, estimate an increase of 2.5%. Interest rates are expected to steadily fall, maybe not until a few months into 2025, which will inevitably give confidence and more affordability to all movers, especially first time buyers and investors. However high refinancing costs on fixed mortgages may hinge this in the near future.

There will inevitably be local and regional variations, but we know the Scottish Borders to be robust, with constant interest from people south of the border and from the nearest cities. 2024 has been a very busy year with Blackwood & Smith, and with the firm’s rebranding and continued expansion, we envisage 2025 to be an even busier and better year than 2024.
In summary, Scotland will see moderate growth but will essentially be triggered by macroeconomic factors such as interest rate fluctuations, and government policy. It all leads to a very exciting year and we would be happy for you to be part of it with our ever growing professional team. If you have any queries about any aspect of property and associated legalities please never hesitate to contact us at one of our offices in Peebles.

Real estate cannot be lost or stolen, not can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world ( Franklin D Roosevelt ).

Overall, while the market shows signs of resilience, challenges such as limited housing stock and rising rental costs require careful navigation. Buyers, investors, and policymakers will need to adapt to these dynamics to make the most of opportunities in Scotland’s property sector.

• Please come and visit us at 15 Eastgate, Peebles or get in touch for all related selling and buying advice. We are here when you need us.