Detached Homes Set the Pace
Recent figures from the Halifax have highlighted a significant trend: detached properties are experiencing the most substantial increase in value. Detached homes across Scotland have seen an average rise of 5.7% in the last year, translating into an uplift of approximately £17,318. The average detached home in Scotland now stands at £321,134.
This upward movement is indicative of broader lifestyle shifts that have persisted beyond the pandemic. The "race for space"—initially driven by lockdown experiences and remote working—has continued to influence homebuyers, reinforcing the appeal of larger, more spacious properties.
A Mixed Market: Understanding Property Types
However, this surge in detached home values contrasts notably with other property categories. Semi-detached homes experienced a modest increase of just 0.7%, with an average price now at £213,067. Flats showed moderate growth of 1.9%, averaging £118,358, while terraced homes experienced a slightly higher growth of 5.9%, reaching an average value of £162,310.
These variances underline that Scotland's housing market isn't uniformly moving upwards—rather, it's evolving differently across property types, influenced by specific local dynamics, changing buyer preferences, and economic conditions.
Underlying Factors Driving Demand
Several factors contribute to the sustained demand for larger properties. Firstly, the shift towards hybrid working has changed homebuyers' priorities, with many continuing to value additional space for home offices and flexible living arrangements. Secondly, easing interest rates have slightly improved affordability for prospective buyers, further boosting demand for higher-value properties.
The renewed focus on larger homes, supported by improved affordability conditions due to easing interest rates, suggests this trend will persist if broader economic conditions remain favourable.
Looking Ahead
The key question for market observers and participants alike is whether this trend towards larger properties is sustainable long-term. While the appeal of extra space remains strong, economic shifts, potential interest rate changes, and evolving housing policies will influence both demand and supply.
However, I do not see any drop if in demand for quality larger property in prime areas with good connectivity and services - that is subject of course. as I say above, to any major macro-economic or geopolitical forces that are beyond the control of buyers and sellers in the local property market and those controlling fiscal leavers.
