Tayside is experiencing a new-build housing boom with few signs of the long predicted cooling in the property market, according to property specialists .
The solicitors and estate agents – the biggest in Tayside - have reported record sales in the first quarter of 2006 with total sales breaking all previous records.
In March, the firm whose estate agency business is founded on sales of traditional second-hand properties, sold over £20 million worth of property, half of that in new build developments.
Thorntons say that high buyer demand and a scarcity of second hand properties fuelled interest in the new build market in 2005 with new developments in Dundee, Perthshire and Angus reflecting the region’s continuing popularity as a destination for home buyers.
Dundee’s buoyant economy and university sector, Perth’s popularity as a commuter and retirement destination, the opening of the new dual carriageway to Arbroath and increasing developer interest in Forfar are key factors in the current new build boom.
The phenomenon of new property being sold before it is even built is now commonplace in Tayside which has not seen the downturn in sales experienced by other areas of the country.
New build activity in the region has increased so markedly that Thorntons established its own New Build team to cope with the stream of inquiries from buyers and developers.
“We established a new build team to provide marketing facilities for various developers in Dundee and Tayside and are now about to expand it to cope with further new developments coming on stream in 2006,” said George Solley, Director of Thorntons Property Services.
“Normally, new build would account for 20% of our business, but in the first two weeks in March it rose to an unprecedented 50% of sales.
“In the last few weeks there has been a large increase in new build sales and the most recent early release of a new development of 71 homes at City Quay in Dundee on behalf of Unicorn Properties created instant sales of 50% of available properties.
“Our mailing lists and client banks show a variety of buyer types awaiting details of new build and second hand property at all price levels and the increased availability of high value new build property is playing a significant role in improving sales activity right across the marketplace.
“Ninewells Hospital, the universities and the technology park are buoyant and drawing in new staff, many from outwith the region. They bring with them funds from sales further south. This fuels the new build and second hand markets and simultaneously allows local buyers to move up market.
“We are naturally sensitive to a long predicted cooling in the Tayside market but at present, there are few signs of this.”
Thorntons say that the provision of high value properties in the new build market continues to have a significant influence on the overall market.
“The popularity of quality new build and the lifting of the ceiling for prices in general has had quite a dramatic effect on the prices which can now be achieved for traditional stone built properties in established residential areas,” continued Mr Solley.
“Prices achieved on some of these property types in recent months have been quite exceptional. The £400,000 to £500,000 semi-detached and detached house is now a regular item in our stock.
“At the other extreme, low value flats which were proving problematic at one time are now in demand as more first time buyers look to this type of property as a means to get on the first rung of the property ladder.”
Mr Solley says he expects to see further sales records broken in 2006 with more new build developments planned.
“We are commonly asked where all the money is coming from to fuel this demand for high value housing in Tayside, but the answer is simple,” he added.
“Existing property owners have found new wealth through the increased value of their current home. That increase in equity encourages many to re-invest further up the market and the relatively low cost of mortgages makes this both attractive and affordable.
“Add that to the current interest shown in the region from incomers and institutional investors and you have all the ingredients for a very buoyant market.”