AN unprecedented frenzy has erupted in the housing market with people panicking as they try to move out of the cities following the coronavirus lockdown, the Sunday National can reveal.

“Daft” money is being offered for properties, particularly those in rural or coastal locations – prompting a warning that there could be a “serious correction” in the coming months.

Ken McEwan, chief executive of leading Scottish estate agents McEwan Fraser Legal, said he had never seen anything like it, with calls to his company from would-be buyers rocketing from around 300 day pre-Covid to more than 1200 a day.

“Overall the market is acting irrationally to be honest,” he said. “I have been in the market for 30 years and I can’t believe what I’m seeing in many areas.

‘‘People are panicking and being irrational and it can’t continue going like this. I have never seen a frenzy like it. People are putting in daft money for houses and are bidding way above what the house is worth. Their behaviour has changed rapidly because of Covid and I have no doubt there will be a correction in the market very soon.”

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He said that people no longer wanted to be in a two bedroom flat up a close or without a garden and because many staff can now work from home there was a surge out of the cities to places in the country.

“We thought there would be a small bounce but there has been a bounce like never before,” said McEwan. “Pre lockdown we would average about 300 calls a day but this has gone up to over 1200 calls a day in the property department.

“We have got staff coming back from furlough and a huge increase in the volume of calls so do we recruit more staff or is the market going to slow down?

“People have maybe put in four or five notes of interest for houses and are now offering money well over the asking price because they have missed out before but they can’t finance the excess money because lenders will only finance the value of the home report. They are financing it on fresh air.”

He added that there were hotspots throughout Scotland with “significant” interest in the Highlands from people south of the Border.

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Tom Stewart-Moore of Knight Frank’s Edinburgh office said they had also seen a “large upturn” in terms of interest from people wanting to move out of towns and cities.

He added: “Employers are saying to a lot of people that they may not be coming back to the office and as long as you have broadband you can do your work from anywhere. We had a couple from London whose employers have agreed they can work from anywhere so they are looking at Scotland.”

Another factor was that the Covid-19 lockdown had led to a growing desire to move out of the city.

“The pattern seems to be people getting in touch and saying they want to move out of town. That might have been felt initially that it was a knee jerk reaction to the lockdown but we are getting the feeling that it is here to stay."