The figures show that average prices increased by 1% in the three months to September compared with 5.5% in the second quarter, which is traditionally the strongest period for activity in the rural market. However, it was the best third-quarter performance since 2013.
Many properties were listed later than normal in Scotland’s rural market last year due to the pandemic. However, following the end of the stamp duty holiday in March, the usual seasonal rhythms are back, and there will be a winter pause until a new wave of listings in spring 2022.
There may be increased hesitation among buyers, against the backdrop of rising inflation and a potential increase in borrowing costs.
The latest quarterly increase took the annual rate of growth to 5.9% in the 12 months to September, which is the strongest performance since 2008 in what has been a transformational period for Scotland’s country market.
As with other parts of the UK, demand has outstripped supply in Scotland’s rural market throughout 2021, with poor weather in May delaying the arrival of new supply and exacerbating the situation.
The number of new prospective buyers in the first nine months of the year were up by more than a third (36%) versus the five-year average excluding 2020, while new instructions were down 20.8% in the same period.
Tom Stewart-Moore, head of Knight Frank’s rural business in Scotland, comments: “The big thing this year has been the volume of viewings, which I’ve never experienced before. We’ve had properties such as Kilberry Castle on the west coast for sale, and buyers have been willing to travel a long way at times to see properties."
Viewings in the first nine months of 2021 are up by close to a third (31%) compared with the five-year average excluding 2020.
Tom concludes: “While prices will naturally simmer over the winter, the recommendation to work from home is still in place in Scotland and I believe that flexibility is here to stay. With buyers focused on where they live rather than simply their commute time, Scotland’s country market will continue to benefit."
