£100,000 slashed from capital house prices

As high street stores offer discounts in the annual January sales in an effort to attract customers, prospective house-buyers are also being encouraged to check their local estate agents for deals this month.

In light of the recent dramatic drop in house prices, estate agents across the capital have decided to market their properties with a difference, allowing first time buyers to see the size of the savings up for grabs.

In an attempt to entice reluctant home-buyers onto the market, around 200 Edinburgh properties will be advertised showing their original valuation alongside their "sale" or current asking price. Figures show that up to £100,000 has been slashed from the asking prices of a number of homes in an effort to kick-start the city's property price cut.

For the first time since the start of Britain's economic woes, the Edinburgh and Lothian Property Guide has revealed just how much house prices have dropped since they were first valued. By exposing these substantial reductions estate agents across Edinburgh are hoping buyers will be encouraged to grab a bargain before property prices begin to rise again.

However, in an effort to allay fears that the move may further depress the housing market, a spokesperson from Edinburgh Solicitors Property Centre (ESPC) emphasised that the price cuts are “no secret” and involve nothing “startlingly new".

“People are aware of the realities of the market at present and confidence is low. Had this information been published over six months ago, it may be different," he said, adding that “buyers are out there, so this move will be to their advantage.”

Steve Spencer, senior partner at Neilson's Solicitors said: “We're trying to underline the fact that this situation is unique and temporary and that over the next six to eighteen months prices will go up again.”

With house prices in Edinburgh dropping by more than ten per cent during the last quarter of 2008 according to the ESPC, the average sale price of a home has now fallen below £200,000 for the first time since early 2007.

When asked about the outlook for the property market in 2009, the spokesman from ESPC stated that it was “possible we’d see an upturn in the number of sales over the duration of the year.”

However, it was acknowledged that there was “little in the way of expectation that the property market will indeed rise.”

A similar situation exists in London—once at the centre of the property bubble—with house prices dropping between 15 to 20 per cent in some areas.

Although large local estate agents such as Hamptons are not actively advertising cuts in house prices, they are available on request.

However, they may, too, be forced to display discount figures in an attempt to inspire new buyers before long, as a spokeswoman from Hamptons told The Journal: “A lot of agents are doing it – it’s the right mindset and something that could potentially work well.”