A house in rural Aberdeenshire has become the first in two years to sell for £1 million – fuelling hopes demand is picking up.
A new report by Savills admits that the housing market in the north-east is still fragile, but confirms a growning number of people from London and overseas want to buy homes in an around Aberdeen.
House prices in Moray have also, on average, risen by 4% year-on-year after an increase in the number of £300,000-plus deals offset a drop in transactions overall.
Aberdeenshire’s £1m breakthrough after several years of housing market doldrums came earlier this year, when Castle Park House, near Maud, was snapped up by a local buyer.
The new owner purchased the three-bedroom house, including 79 acres of parkland, equestrian facilities and the ruins of Brucklay Castle, for just over the landmark price threshold.
Savills currently has two more prestigious homes on the market: Tillycorthie Mansion House at Udny, near Ellon, at offers over £1.5m; and Dess House, near Aboyne, at offers over £1.05m.
Faisal Choudhry, head of residential research for Savills in Scotland, said the mood was “very upbeat” at a gathering of 200 property experts in Aberdeen yesterday.
While “not yet out of the woods” after a bleak few years amid the oil and has downturn, he claimed the north-east market is now considerably more stable.
And he added that stock levels and “value for money prices” are attracting a lot of interest from outwith the area, including expat Aberdonians and other people who have moved away from the north-east who are keen to “return home”.
The report revealed that Alford, Inverurie and “the Kincardineshire hotspot of Stonehaven”, were among the busiest places for deals.
And it highlighted that affluent Aberdeen suburbs including Bieldside, Cults and Milltimber enjoyed a 34% annual increase in new build sales, triggering second-hand sales from “aspirational movers and downsizers”.
Sales of new homes in the Cove Bay area nearly doubled last year, sparking a “modest recovery” in second hand activity.
But Mr Choudhry warned that while the overall market is stabilising, it will remain fragile until there is a sustained period of realistic pricing.
He added: “Prices are beginning to find their level, with the monthly average in Aberdeen city and Aberdeenshire staying around the £160,000 and £190,000 level respectively for most of 2018.
“They are currently around 4% lower than 2017. We expect such falls to ease in 2019, subject to a further reduction in stock levels.
“We anticipate that prices will follow a similar upward trend to the rest of Scotland from 2020 onwards, with 4% growth over the five-year period between 2019 and 2023.”
This is after a 20% drop in average prices in Aberdeen after the oil price crash in late 2014.
Savills expects Scottish house prices to grow by 14.8% between 2019 and 2023.