Mortgage News
Scottish house prices rise 3.7%
Scotland’s housing market appears to have stabilised after house prices fell in the previous quarter, according to Lloyds TSB Scotland, yet this follows a sharp drop in purchases.
Lloyds TSB figures revealed annual property price growth in Scotland of 4.6%.
In the three months to the end of October 2010, the average residential home in Scotland increased 3.7% in value, giving an average price of £165,284.
However, price growth has been generated from a quarter of low sales. The number of house purchases dropped 17% on the previous quarter and were 10% down year-on-year.
By comparison to 2009 for the whole market, Scottish house purchases were 3% less in September 2010 – the second consecutive monthly fall in house purchases after five months of increases.
Lloyds TSB figures showed that housing transactions in Scotland are around half or pre-recession levels.
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Donald MacRae, chief economist of Lloyds TSB Scotland, said: “The Scottish economy exited recession at the end of last year but then showed a decline in output in the first quarter of this year. After five quarters of declining output in the last seven, the Scottish economy recorded a robust increase of 1.3% in growth in the three months ending June 2010.
“The Scottish housing market has adjusted to this changing economic environment. Sales have halved but have now stabilised while prices, after an initial fall, are now showing an annual increase comparable to retail price inflation. There are no signs of a precipitate fall in house prices. Likewise there is little prospect of significant house price gains in the immediate future.”