Aberdeen’s housing market experienced a downturn in the first quarter of 2024, with property prices falling by 2.9%. This report, a collaborative effort between Aberdeen Solicitors’ Property Centre Limited (ASPC) and the University of Aberdeen’s Centre for Real Estate Research, reveals several nuanced trends within the city’s property sector. While the quarterly figures point to a decline, the broader context suggests a mixed bag of results across different types of properties and local areas.
Key Figures and Trends
The data from the first quarter sheds light on a few critical areas:
- Quarterly Change: House prices in Aberdeen have decreased by 2.9%.
- Annual Change: Over the past year, prices have seen a slight decline of 1.5%.
- Five-Year Outlook: Looking at a longer timeframe, the annualised change over the past five years shows a marginal increase of 0.8%.
These statistics suggest that while the market has faced recent declines, the long-term trend shows some level of resilience.
Market Analysis by Area and Housing Type
John MacRae, the chairman of ASPC’s board, provides a deeper insight into the variations within the market. According to MacRae, “The condition of our local housing market is difficult to pigeonhole as there are variations across housing types and areas.” For instance, while Stonehaven’s housing prices remained stable in the first quarter, other regions experienced declines. Similarly, different types of housing like flats and detached homes saw varying trends. Flats in certain cities like Aberdeen and Ellon displayed positive movements or stability, whereas, in Stonehaven and rural areas, flats faced price reductions. Semi-detached and detached homes generally saw a decline.
This diverse picture points to an overall complex and somewhat disheartening scenario, though it’s clear that different segments of the market are reacting differently to underlying economic pressures.
Economic Factors Influencing the Housing Market
Delving into economic influences, MacRae suggests that local and national economic conditions significantly impact buying decisions. Although inflation has decreased, it hasn’t fallen to anticipated levels. Additionally, expected reductions in interest rates did not materialise, and banks have slightly increased the rates on some fixed-rate loans.
“The situation is complex, with some good news and some not so good,” MacRae adds, reflecting on the broader economic landscape that includes discouraging world affairs and daily news.
Signs of Recovery?
Despite the mixed economic backdrop, there are glimpses of potential recovery. Early 2024 data indicates a 10% increase in new listings compared to the same period in 2023, and sales have risen by 4%. These figures represent only a single quarter’s performance but provide a cautiously optimistic outlook for Aberdeen’s housing market going forward.