by Hammad Alam

In Q2 2023, the Scottish housing market shows signs of stabilization after pandemic-induced volatility, although transactions have decreased by 1.9% compared to pre-pandemic levels. Higher interest rates have tempered house price inflation, dropping from 13.3% in Q3 2021 to 2.0% in Q1 2023. Rental prices continue to rise, with private housing rentals increasing by 12.4% annually. Lending to first-time buyers and home movers has fallen by 8.7% and 8.9%, respectively. Mortgage approvals are 27% lower than pre-pandemic levels, and mortgage products have reduced by 5.6%. New build home completions increased by 8.8%, but construction costs have risen, impacting supply. Construction firm insolvencies returned to pre-pandemic levels, totaling 202 in Q1 2023. Despite a slight recovery, the market remains cautious due to ongoing economic uncertainties.