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Winter chill settles over Edinburgh as homebuyers hold off

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By September, Sarah Troy and her husband Graeme had been looking for a single-family townhouse west of Edinburgh for a year. Several suitable homes she heard were either sold on the market or disappeared within days. On one occasion, she, along with 15 others of hers, made an offer 15% above her asking price, but the house sold for 30% above hers. Exhausted, she gave herself up to a more protracted search.

And then, almost overnight, things started to change. “For six months she didn’t have a single suitable home. In September and in October she had 25, I think,” she says. An agent is currently approaching her who she is too busy to call back. “Now we’re waiting for exactly the right one, and I’m sure we’ll find something in the coming months,” she says.

Home sales in and around Edinburgh are declining as rising mortgage rates cut buyers’ budgets and many are holding off buying in case prices fall, prompting sellers to push prices down. The number of homes sold under contract on Zoopla in the month ending Nov. 20 was down 21% from the year before. Nearly 1 in 10 homes on the site had his asking price reduced by more than 5% during this period.

Price cuts of this magnitude are rare, said Richard Donnell, Zoopla’s head of research.

Stockbridge, famous for its restaurants and shops: ‘Demand is gone,’ says mortgage broker in Edinburgh market © Adam Goodwin/Alamy

Sellers eager to secure a sale accept the first reasonable offer, according to local agent Sylvia Kuzminski. In the summer, “95%” of the homes she sold went to a closing date. This is a process in which multiple offers are submitted in writing by a certain time and is usually preferred when demand is strong as it means more homes will sell. “We are not getting enough buyer interest today to justify a closing date,” she says.

In a typical month, Kuzminski sells 4-6 homes. In October, her five of her sales fell through as her buyers pulled out, whereas from July she had zero by September. “Mostly because the buyer was having trouble financing her,” she says.

“Usually my clients who are refinancing their mortgages are spending less money each month than they did a year ago,” said Lis Forrest, a mortgage broker serving clients in Edinburgh, Central Lothian, East Lothian and West Lothian. Mortgage payments are up 40 to 50 percent.”

Charlotte, who didn’t want to reveal her real name, and her husband, who is in her early 20s, had to reapply for a mortgage after their home purchase failed in September. The house they finally bought in Gracemount, south of the city, was £25,000 cheaper than the one they missed. However, mortgage interest rates increased in the meantime, increasing her monthly payments by £200 to £1,026 for her.

Edinburgh's Georgian New Town

Edinburgh’s Georgian New Town © Alan Wilson/Alamy

“It’s poignant, especially since rising mortgage rates have hit on both ends,” she says. “Our first purchase fell through when our chain fell apart. The man who was to buy our house backed out when he got a mortgage offer and was forced to pay. I realized that I couldn’t afford it.”

According to Forrest, his biggest dip in the business since the summer has been among young professionals. Usually a couple in their late 20s to his early 30s sold terraced or semi-detached houses with 2-3 bedrooms, garages and he bought a 4-bedroom house. large garden.

“They can’t afford rising mortgage rates, rising gas and electricity bills, and bigger homes. This was happening even before the ‘mini’ budget,” he said, adding that the turmoil in financial markets was a factor. The five-year fixed average rate is 6.51%, according to Moneyfacts by November 1, citing former Finance Minister Kwasi Kwarten’s September 23 financial report, which triggered a sharp rise in mortgage rates. .

“[Buyers] We choose to remodel our homes instead,” says Forrest. “In my view, the demand for those homes is evaporating.” Mortgage rates have fallen slightly in recent weeks, and his five-year fixed average this week was 5.95% for him.

Many wealthy families with young children prefer Bruntsfield or Marquiston. Located near and south of Edinburgh Castle, these areas include Georgian and Victorian detached and terraced houses. Access to the city center.

New Town, just north of Princes Street, is popular for its elegant, high-ceilinged Georgian apartments. Further north, Stockbridge is full of delis, cafes and gastropubs and boasts the city’s botanical gardens. There are quite a few period apartments and some houses.

The problem created by high mortgage rates favors those with little or no mortgage.

“Over the summer, the agents didn’t care that I was a cash buyer. But when I offered my house in September, they practically chewed my hands out.” says Rachel Yarrington, who bought a four-bedroom detached house in Livingston, West Lothian for £330,000 after returning from work in Canada to settle.

She gave up looking for a house in July, she says. I was just depressed. When she started looking again in August, she noticed that many homes marked as sold were back on the market. “When I visited them, I made sure to ask them why they were on the market again. It always seemed to be a problem with buyer financing,” she says.

Holyrood Park

Holyrood Park © Arch White/Alamy

Her cash position also put her in charge of the sales process, she says: The seller wanted to delay the completion date to give her time to look for another home. , I kept my stuff. I wanted to move in right away.”

“Previously, agents didn’t want to hear our details. Today, when you say you’re a cash buyer, they’re more interested in what they’re saying,” says Graeme Troy. . He is ready to call the agent bluff. “Someone told me the other day that there is still a huge backlog of people eager to buy.

The Troy family returned from Abu Dhabi earlier this year and are frustrated with the delay in embarking on a new life. But the end is finally in sight. Sarah is looking for a big house to renovate or rebuild and she is excited about this project.

“I went from feeling pretty negative to feeling really hopeful,” she says. “I still disrespect my kids who were so excited to design their dream bedroom. We said we could build a climbing wall. Lifestyle finally back I feel like I can make it happen.”

Buying guide

  • Of the 723 sales agreed in Edinburgh last month, 22 were for £1 million or more, according to data from property data firm TwentyCi.

  • The average price of homes sold in the year to September was £308,866. That’s up from £291,193 a year ago, according to Savills.

  • Travel time from London to Edinburgh is 4 hours and 30 minutes. Travel time from Glasgow is 50 minutes.

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