5. UK House Price Index (HPI) new build sales transactions, as a measure of private-led housebuilding activity to end October 2020
This section sets out the latest quarterly and monthly trends in the number of new build sales transactions in Scotland to end October 2020, based on residential property transaction figures published as part of the UK House Price Index (HPI).
These figures may be helpful in providing an indication of recent levels of private led new housebuilding activity, particularly given the current delay in the publication of the Scottish Government new housebuilding private-led starts and completions figures.
It should be noted that the HPI-based figures are not directly comparable to the Scottish Government time series on private-led new build starts and completion, due to some differences in how the two sets of figures are constructed. For example, the UK HPI new build sales transaction figures are based on the date of the completed sales transaction rather than the date of completion, and will also not include self-build dwellings or homes built privately for tenures other than private sales.
Further information on the quality of the HPI data for Scotland, which is sourced from Registers of Scotland, is available in the UK HPI Quality Assurance section of the UK House Price Index web page.
Table 3 and Chart 7a below illustrate how the UK HPI figures compare to previously published Scottish Government Private sector-led completion figures in each quarter from January to March 2019 onwards, and also provide the latest trends seen in the UK HPI new build sales transactions figures across the two more recent quarters to July to September 2020.
It can be seen across the period January to March 2019 to January to March 2020 (the latest available quarterly figures for Scottish Government Private led completions) that both data series follow similar trends in respect of increases or decreases compared to the previous quarter. The Scottish Government figures are higher each quarter, but this is likely to be explained by differences in how the figures are constructed, given that some self-build dwellings or dwellings built privately for tenures other than private sales will be included, whereas the HPI figures are based on private sale transactions only.
|HPI New Build Sales Transactions Volume||Scottish Government Private-led completions|
|Jan – Mar 2019||2,407||3,438|
|Apr – Jun 2019||3,293||4,484|
|Jul – Sep 2019||2,759||4,009|
|Oct – Dec 2019||3,807||4,756|
|Jan – Mar 2020||2,360||2,989|
|Apr – Jun 2020||698||Not available|
|Jul – Sep 2020||2,337||Not available|
|Change from previous quarter||1,639|
|Change (%) from previous quarter||235%|
|Change from same quarter in previous year||-422|
|Change (%) from same quarter in previous year||-15%|
Sources: UK House Price Index: reports - GOV.UK (www.gov.uk) (December 2020 data downloads) and Scottish Government Private Sector-led new build completions
The latest quarterly HPI figures show that there were 2,337 new build sales transactions in Scotland in the quarter July to September 2020, an increase of 1,639 on the 698 transactions seen in April to June 2020, and which follows the easing of COVID-19 related construction and housing market restrictions from late June 2020 onwards.
The 2,337 new build sales transactions in July to September 2020 is 422 (15%) transactions below the level seen in the same quarter in the previous year, indicating that private new build activity may not have fully recovered to pre-pandemic levels by the quarter to end September 2020. However more recent HPI figures for the month of October 2020 indicate a greater level of recovery, with 1,114 transactions in this single month, an increase of 47 (4%) on the number of transactions in October 2019 (see Chart 7b).
Table 4 below shows the local authority level HPI figures for the number of private new build sales transactions. It can be seen that nearly all local authority areas have seen a substantial increase in the number of private new build sales in July to September 2020 when compared to the previous quarter April to July 2020. Apart from Na h-Eileanan Siar and Shetland Islands, which both showed no increase, every other local authority area has seen volumes of transactions increase by 94% or more.
When looking at levels of private new build sales in July to September 2020 compared to the same quarter in the previous year, 21 out of 32 authority areas have levels which are below what they were in July to September 2019. However when looking at the more recent single month of October 2020, a greater recovery of sales is apparent, with 21 out of 32 authorities seeing an increase in sales, with only 9 authorities showing a drop, and 2 showing no change.
|Jul-Sep 2019||Oct-Dec 2019||Jan-Mar 2020||Apr-Jun 2020||Jul-Sep Jul-Sep 2020 compared to previous quarter||Jul-Sep 2020 compared to same quarter in prevous year||2020||Month of Oct 2019||Month of Oct 2020||Difference||Difference (%)|
|Argyll and Bute||14||44||14||8||21||13||163%||7||50%||10||15||5||50%|
|City of Aberdeen||102||154||97||34||99||65||191%||-3||-3%||34||37||3||9%|
|City of Dundee||51||57||50||12||86||74||617%||35||69%||7||2013||186%|
|City of Edinburgh||337||397||295||72||221||149||207%||-116||-34%||104||109||5||5%|
|City of Glasgow||222||309||215||50||192||142||284%||-30||-14%||96||99||3||3%|
|Dumfries and Galloway||27||31||16||3||24||21||700%||-3-||11%||17||0||-17||-100%|
|Na h-Eileanan Siar||2||2||1||1||0||0%||-1||-50%||0||1||1||n/a|
|Perth and Kinross||129||137||78||20||88||68||340%||-41||-32%||39||36||-3||-8%|
Source: UK House Price Index: reports - GOV.UK (www.gov.uk) (December 2020 data downloads)