Tayside and Fife is experiencing a mini property boom despite lockdown as supply outstrips demand across the region.
In line with current government guidance, the property market is still operating, as all activities associated with moving house are still permitted provided all appropriate safety guidance is followed.
This includes home appraisals, home report inspections, viewings, mortgage applications, offers accepted and home moves, including cross-borders.
Experts say the increased demand has fuelled a surge in prices for all types of residential properties.
Year-on-year property price increases of almost 7% have been reported locally.
The market is also positive for first time buyers who are benefiting from low interest rates, help-to-buy schemes and a freeze on Land and Buildings Transaction Tax (LBTT).
Supply struggling to meet demand
However those looking to purchase their first home are being cautioned against paying over the odds for property that they will sell on again in the near future.
Ken Thomson, partner and head of residential property at Thorntons, believes it is an ideal time to sell.
He said: “We’ve witnessed an immediate and sustained mini-property boom since the market reopened in June 2020.
“There’s been such a pent-up demand fuelling the marketplace that in some areas has meant supply has struggled to meet demand.
“This has led to an increase in prices for all properties from small flats to top-end homes, which in some areas of Scotland, including Edinburgh and the Borders, have been significant.
“The year on year average price rise to the end of December was 6.8% in Dundee and Angus, 6.5% in Perth and 5.3% in Fife.
“Sales are only restricted by the number of homes coming to market but the demand from buyers has remained undiminished and first-time buyers have played a large part in driving the market.”
Schemes available to help first-time buyers
He added that the number of new would-be homeowners has been boosted by a number of initiatives.
He said: “Part of this has been, in part, due to the availability of Government assistance through the Help to Buy ISA scheme. This has now closed to new savers and has been replaced in part by the slightly less attractive Lifetime ISA scheme.
“The First Homes Fund, a shared equity scheme providing cash loans of up to £25,000 to assist in the purchase of a first home, has also proved hugely popular.
“This scheme was closed to applications in October, but has now re-opened for applications to assist with purchases that will complete on or after April 1 2021.
“Assistance may also still be available to new buyers under the LIFT Open Market Shared Equity Scheme. Funding is limited and is subject to maximum price thresholds that are fixed by reference to the number of rooms in the house being purchased, and the area within which it is being purchased – but it could provide a welcome boost.
“Another current incentive is the fact that Land and Buildings Transaction Tax (LBTT) is not payable where the purchase of a property is at a price of £250,000.00 or less.
“That currently leads to a saving for buyers of up to £2100.00 but that only applies to purchases that complete on or before March 31 2021.”
He cautioned that Tayside and Fife’s property boom should not make new buyers feel pressured into paying too much.
He said: “Ultimately, I believe there is never a bad time to get onto the property ladder but if there is a word of caution for first-time buyers, it is that that they do not pay an inflated price in a bullish market for a property that, as a first home, they may themselves be looking to sell again in three or four years’ time.
“But for sellers, this is a perfect time as you will be feeding demand.”
