19. Juli 2012 
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Consumers remain optimistic about the prospectus for the Scottish housing market
More people in Scotland expect house prices to rise than fall over the coming twelve months, according to the latest quarterly Bank of Scotland Housing Market Confidence tracker. Just over a quarter (28%) of respondents forecast that house prices will rise over the next year, whilst just over a fifth of respondents (22%) predict a decline in prices over the same period.
Nonetheless, the headline House Price Outlook balance (i.e. the difference between the proportion of people that expect house prices to rise rather than fall) eased from +10 percentage points in March to +6 in June. Despite this slight weakening, confidence in house price prospects remains higher than at the beginning of the year with the House Price Outlook balance in June being higher than the reading of +4 in January.
However, confidence in house prices in Scotland remains lower than the average across Great Britain (+15). In addition, only people residing in the East Midlands (+2) and the North East of England (+4) are less optimistic regarding the outlook for house price movements. Those living in London and Wales are the most confident about the prospects for the housing market with an overall net balance of +25 for both in June. These areas are followed by the South East of England (+22) and the East of England (+21).
Like Scotland, eight of the nine English regions tracked saw a weakening in their headline House Price Outlook balance between March and June. The South West of England recorded the biggest fall (-17), followed by the East Midlands (-15). Wales (+13) and the West Midlands (+8) were the only regions to see a positive increase in sentiment in their headline House Price Outlook balance.
Concerns over job security to constrain housing demand
Nearly two-thirds of respondents (61%) highlighted concerns about job security as the main barrier to buying a home. Respondents also picked out the challenges in raising a deposit (52%) and household finances (36%) as major hurdles to home buying.
Nitesh Patel, housing economist at Bank of Scotland, commented:
„Confidence in the Scottish housing market has weakened a little over the last three months, reflecting the increased uncertainty regarding the economic outlook. The public's confidence in the housing market, however, has been very resilient so far this year. This is consistent with the broad house price stability experienced over the first half of 2012.
“Overall, we expect little change in prices and sales over the remainder of the year, provided that the Scottish economic outlook does not deteriorate significantly."
Additional Findings:
Public opinion continues to point to a buyers’ market
Over half the respondents (53%) think it will be a good time to buy in the next 12 months. This is nearly seven times the proportion of people in Scotland who feel it will be a good time to sell (8%). Overall, just 8% of those questioned were positive about both buying and selling over the next year, suggesting that the level of housing market activity in Scotland is likely to remain subdued.
Over half of those living in Scotland expect rents to rise in 2012
Over half (53%) of respondents forecast that the cost of private sector renting will increase over the next year, substantially higher than the proportion who thinks that rents will fall (2%).
Nonetheless, the headline House Price Outlook balance (i.e. the difference between the proportion of people that expect house prices to rise rather than fall) eased from +10 percentage points in March to +6 in June. Despite this slight weakening, confidence in house price prospects remains higher than at the beginning of the year with the House Price Outlook balance in June being higher than the reading of +4 in January.
However, confidence in house prices in Scotland remains lower than the average across Great Britain (+15). In addition, only people residing in the East Midlands (+2) and the North East of England (+4) are less optimistic regarding the outlook for house price movements. Those living in London and Wales are the most confident about the prospects for the housing market with an overall net balance of +25 for both in June. These areas are followed by the South East of England (+22) and the East of England (+21).
Like Scotland, eight of the nine English regions tracked saw a weakening in their headline House Price Outlook balance between March and June. The South West of England recorded the biggest fall (-17), followed by the East Midlands (-15). Wales (+13) and the West Midlands (+8) were the only regions to see a positive increase in sentiment in their headline House Price Outlook balance.
Concerns over job security to constrain housing demand
Nearly two-thirds of respondents (61%) highlighted concerns about job security as the main barrier to buying a home. Respondents also picked out the challenges in raising a deposit (52%) and household finances (36%) as major hurdles to home buying.
Nitesh Patel, housing economist at Bank of Scotland, commented:
„Confidence in the Scottish housing market has weakened a little over the last three months, reflecting the increased uncertainty regarding the economic outlook. The public's confidence in the housing market, however, has been very resilient so far this year. This is consistent with the broad house price stability experienced over the first half of 2012.
“Overall, we expect little change in prices and sales over the remainder of the year, provided that the Scottish economic outlook does not deteriorate significantly."
Additional Findings:
Public opinion continues to point to a buyers’ market
Over half the respondents (53%) think it will be a good time to buy in the next 12 months. This is nearly seven times the proportion of people in Scotland who feel it will be a good time to sell (8%). Overall, just 8% of those questioned were positive about both buying and selling over the next year, suggesting that the level of housing market activity in Scotland is likely to remain subdued.
Over half of those living in Scotland expect rents to rise in 2012
Over half (53%) of respondents forecast that the cost of private sector renting will increase over the next year, substantially higher than the proportion who thinks that rents will fall (2%).
