Residential property stock levels have dropped by up to 70% in cities and towns across Scotland, according to analysis of the latest data by DJ Alexander Ltd.

The agency, which is now part of the Lomond Group, found that the number of properties advertised for sale has fallen by up to 70% from the most recent peak recorded in November 2020.

The volume of properties available fell across the whole of Scotland and was down 70% in Dundee over this period; fell 63% in Dumfries; down 58% in Dunfermline; a 56% fall in Perth; a drop of 53% in Glasgow; 51% in Stirling; down 49% in Edinburgh and Paisley; 42% in Inverness; and 18% in Aberdeen.

David Alexander, the chief executive officer of DJ Alexander Scotland, commented: “Many people have been struggling to understand why property prices have risen so rapidly and continue to remain buoyant. The simple answer is supply and demand with thousands fewer properties on the market compared to just 18 months ago.”

“That this is happening across Scotland from major urban areas to smaller towns tells you that the market is desperately short of supply which, in turn, is causing bidding wars for the properties that do come onto the market.”

He continued: “Anyone involved with the property sector will already be aware that there is a severe shortage of properties for sale on the market and those that do arrive are being sold very quickly.

“However, we now have the property market going in two different directions. Interest rate rises, the cost-of-living crisis, and utility prices rocketing are suppressing buyer interest at the same time that extremely low levels of stock are inflating demand. The two contrasting directions must balance out at some point, but it is an unusual combination resulting in a contradictory market that is both booming and cooling at the same time.”

“The causes of this shortage are varied including the loss of a substantial period of housebuilding due to the pandemic and subsequent labour and material shortages but there had been low levels of new and development building in the years prior to 2020. The market needs a certain number of new properties each year simply to keep pace with demand and if that stops for even a relatively short period the impact is substantial for some time to come.”

“It is clear that there are now several factors which will cool demand in the market but given the remarkably low levels of stock it may be some time before this has a major impact on pricing,” Alexander added. “Therefore, I believe we are starting to see a cooling of the market but the unusual circumstances we are in means that the slowing of prices will take longer than would usually be the case when there is plenty of stock available.”

Number of properties advertised for sale

Place                                  May 2022                                        November 2020              %

Dundee                             114                                                   378                                    -70

Dumfries                          57                                                     156                                    -63

Dunfermline                    79                                                     187                                    -58

Perth                                 97                                                     219                                    -56

Glasgow                            1273                                                 2737                                  -53

Stirling                               53                                                     109                                    -51

Edinburgh                        1203                                                 2357                                  -49

Paisley                               145                                                   283                                    -49

Inverness                          136                                                   234                                    -42

Aberdeen                         2559                                                 3120                                   -18

Source: DJ Alexander Ltd.