Mixed picture emerges as the focus switches to 2025

Looking ahead to the coming year is always fraught with risks as the property market can be heavily impacted by outside influences such as interest rates, economic forecasts, and unemployment levels.

Interest rates are unlikely to be a major dampener on price growth, but the economy and unemployment levels could pose risks if the current low levels of GDP growth persists and the potential fallout in jobs happens due to the rise in employer national insurance. However, these are unpredictable factors which can dampen growth but would be unlikely to damage it unless we enter recession and unemployment rises steeply.

I do believe that the current boom that the housebuying market is experiencing in Scotland is likely to continue, albeit at a potentially slighter lower rate than 2024. This may not be a bad thing because too much rapid growth can be problematic if it leads to falling prices in the future.

What I would like to see to bolster housebuying would be a levelling of the taxes on property purchases. At present the Land and Buildings Transaction Tax (LBTT) punitively punishes buyers in Scotland (and increasingly second home and property investors with the Additional Dwelling Tax rising to 8 per cent in the recent budget, which is double the English rate). Creating a level playing field in property purchase tax would go some way to encouraging more homebuyers and more investment in the market in 2025.

Equally some more support for homebuilders is essential. Scotland dipped to a ten-year low for all sector new home builds and this must be reversed if we are to tackle the major housing issues which are impacting Scotland at present.

With 13 councils declaring a housing emergency it is clear that we are beyond the point of simply chatting about solutions, there must be delivery.

The social housing sector is in crisis and there must be more homes delivered, waiting lists reduced, and a policy which looks at the next ten and twenty years rather than simply the next political cycle.

Greater clarity on the direction of travel for the private rented sector (PRS) is vital if we are to develop a broad-based, coherent housing market that offers something for all people living in Scotland.

The Scottish Government must listen to the views of landlords, property investors, financial institutions, agents, and tenants to produce a system that continues to provide enough homes in the right areas which are affordable yet also profitable for their owners.

There needs to be a unified and concentrated route toward addressing the serious housing needs of Scotland in 2025. The last year has seen a slight shift toward this with a softening of the approach in the Housing Scotland Bill, but this has not gone far enough or fast enough.

The last year has shown us we need action now to address these major issues if we are not to have the same message repeated each year that things are simply standing still. The status quo will simply not cut it and there needs to be serious work to deliver on new homes, a growing private rented sector, and a return to serious social housebuilding.