Scottish house prices continue to rise - report

THE Scottish independence debate is having no impact on confidence within the housing market, which continued its upward trajectory at the start of the year, a report suggests.

The Scottish housing market has continued its upward trajectory. Picture: TSPL
The Scottish housing market has continued its upward trajectory. Picture: TSPL

Average house prices rose by more than £6,000 over last year to reach £160,270 in January, the latest LSL Property Services / Acadata Scotland house price index found.

The rise, equivalent to 3.9 per cent, was the largest annual increase since September 2010 when house prices were on the rebound from the 2009 housing credit crisis, the study said.

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Over the last year, monthly prices have risen on nine occasions, with only three months in the summer holiday season seeing prices fall.

Donald MacLellan, chairman of Walker Fraser Steele Chartered Surveyors, part of LSL Property Services, said the property market seems unaffected by the ongoing debate over Scotland’s future.

“The enthusiasm of property investors suggests the independence debate is having no impact on confidence within the Scottish housing market,” he said.

“Scottish prices are up £1,680 in January. Five consecutive months of rising prices indicate the market has bounced back fast as it gathers the fruits of the wider economic recovery.

“Whether the possibility of Scottish independence throws up all sorts of question marks such as the economic cost of a separate monetary system for Scotland, currency risks, changes to stamp duty and land tax, the property market seems currently unaffected. And whether some businesses are alarmed by the prospect of the use of a currency other than sterling, a development that might lead to a rise in transitional risks, large business costs, with corresponding implications for jobs, as of yet there is little obvious impact.

“Banks such as RBS and Standard Life have threatened to leave Scotland altogether and decamp to England, possibly causing a drop in net lending. But if a Yes vote for independence looked like the more probable outcome, we would expect this uncertainty to have manifested itself in property prices. As we can see, there has been no such impact on the housing market.”

In other findings, 2014 brought the highest volume of sales recorded in a January since 2008.

On an annual basis, prices have risen in 25 of Scotland’s 32 local authority areas, up 11 on three months ago.

This demonstrates the current upward pressure on house prices as demand for properties continues to increase, the report found.

Mr MacLellan added: “Increased lending and mortgage availability are reaching heights not seen since before the recession as first-time buyers return to the market en masse. Mortgage finance - for those who can access it - is at its cheapest for some time. This is sustaining activity in all sections of the market, specifically buy-to-let investors and homeowners looking to upgrade.”

Housing market specialist Peter Williams, chairman of Acadata, said one of the main challenges ahead for the market will be how to satisfy the evident demand for housing.

Dr Williams said: “Most estate agents are reporting a lack of new sellers coming to the market, which will have the effect of pushing prices up as buyers compete for the reducing number of properties available.”