A number of major commercial developments in Edinburgh are driving up property prices in the nation's’ capital with experts warning that they could spark a property boom.

A £200 million office, hotel and retail project at Haymarket, the Caltongate scheme in the Old Town, the redevelopment of the St James Quarter.

Potential Property Boom

While experts have stated that such developments could result in a rise in the value or residential property, many have warned that first-time-buyers could be frozen out of the property market in Edinburgh. With such rising prices, many may not be able to afford the price of a property or even the rent in such areas.

The Edinburgh Solicitors Property Centre stated that the number of new projects in the city centre were likely to lead to price increases.

A spokeswoman said: “New mixed-use developments bring a sense of reinvigoration to the area, often seeing a shift in where high-end, exclusive retailers choose to be located.

“These new facilities and services will then attract more people who wish to live in an increasingly vibrant area.”

“No doubt these developments at Haymarket, New Waverley and St James Centre will attract business and investment, and make these areas even more desirable.

“The market is only just recovering from the recession, but areas such as Leith Walk, Fountainbridge, Gorgie and Haymarket are increasingly becoming popular places to live and to buy property, so we anticipate the market will continue to see steady year-on-year growth.”

Boom Driven By Skilled Workers?

As well as the redevelopment of much of the city, the number of technology companies moving to Edinburgh are set to have an effect on property values in the surrounding area. Indeed, experts have stated that the West End of the city could boom due to an influx of workers coming into the city. Companies such as FanDuel have moved to the city with other tech companies also moving into many of the new office space.

According to statistics, a number of Edinburgh's office deals in 2015 involved technology, media and telecommunications companies with the sector accounting for 34% of total take-up in Edinburgh last year, more than the city’s financial services sector. While such companies coming to Edinburgh has arguably increased the value of property, especially in the regenerated areas, it has also led to a higher demand for property thus also pushing the property market up.

This year Edinburgh has seen a marked rise in the property value with a number of houses in areas that are getting redeveloped selling for substantially more than in the past. Across Scotland properties have risen by around 3% on average with major cities such as Edinburgh and Glasgow being the most expensive area to buy.

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