House prices in Aberdeen have fallen by almost 5% in the past five years, according to a new report.
New statistics for the second quarter of 2020 released by ASPC and Aberdeen University’s Centre for Real Estate Research (CRER) shows the effect lockdown has had on the property market.
The coronavirus pandemic has had a huge impact on the north-east property market, with data showing that there was almost no new homes put up for sale at the start of lockdown, although this has now begun to increase.
House prices have been recorded to have increased in Aberdeen in the past quarter by 3.5%, however caution has been given over the figures given the low number of transactions carried out in the quarter.
There has also been an increase of 0.9% on the past year in the city.
Increases were also recorded in Inverurie and Stonehaven.
Home prices were up 2.7% compared to the last quarter’s sales, while yearly there was an increase of 2.5%. However, they are said to have dropped 4.4% in the past five years.
A similar picture has been seen in Stonehaven, with a 1.8% increase on last quarter, and 1.9% increase on last year. Prices have dropped 4.1% on the past five years.
In Ellon however, prices have dropped across the board. A 0.9% decrease in price was recorded on the last quarter, as well as year-on-year. A 2.7% drop in price was also seen in the past five years.
Chairman of the board of directors of ASPC John MacRae said lockdown had a “dramatic” impact on the sales, however it wasn’t an unexpected outcome.
However, he said there was an “even more severe” drop in properties coming to the market in the second quarter.
He added: “The report released by the Centre for Real Estate Research at the University of Aberdeen Business School, for the second quarter of 2020, based on data supplied by ASPC contains details of just how the current situation has affected our local housing market.
“We knew that the Government strategy of lockdown was going to have severe effects for nearly all areas of business; the latest report shows just how dramatic that has been. Compared to the same period in 2019, sales fell by 64%. Given the severity of the lockdown provisions this should not be regarded as unexpected.
“Unsurprisingly, this was matched, during the second quarter, with an even more severe drop in properties coming to market. In the early part of lockdown, new insertions on ASPC dropped almost to zero. Since then, however, things progressed and since the easing of lockdown, insertions have risen, quickly, to near normal levels.
“This activity appears to be matched by sales, although we have to bear in mind that sales were already at lower levels before lockdown.”
In the second quarter of 2020, 443 residential properties in the north-east were transacted, down 57% on the first quarter of the year, and down 64.4% on the same time last year.
This included 112 flats, down 69.4% on last year, 178 semi-detached houses, down 61.3% on last year and 153 detached homes, down 63.3% on last year.
“One interesting factor is that sales that are taking place are taking place, generally, at a price level slightly below asking price. This may be a good time to buy.
“The inferences to be drawn, if any, from the second quarter are subject to great caution. The low activity, resulting in reduced numbers of transactions, means it would be unwise to reach any fixed view of the current market. The welcome return to more “normal” activity, shown in the last four weeks, needs to continue for the remainder of the year, before we can say we seem to be over the worst.”