Average property price hits new record in Scotland - but growth slowest for three months

The average house price in Scotland hit a new record in August – but the market saw the slowest rate of growth in three months.

A home in Scotland now costs a record high average of £204,362 – with property prices once again increasing in the last month amid an annual increase of 9.4%.

Properties in North Ayrshire, Argyll and Bute and West Dunbartonshire have seen the bigger increases in value since 2022, however, with slower rates than the last three months, the latest figures suggest a slowing in the property market.

Indeed across the UK, only London with 8.8% growth saw a smaller increase for the month of August than Scotland.

Property in Scotland has risen in value once more, but at a slower rate than at any point in the past three months.

Across the UK, the average house price increased by 0.4% month on month in August to hit a new record high, offsetting a 0.1% dip in July, according to an index – with property values up by 11.5% for the year.

According to Halifax’s House Price Index, a typical property in the UK now costs a record £294,260 – but its report warned that “a more challenging period for house prices should be expected”.

Graham Blair, Mortgages Director, Bank of Scotland, said: “Scotland house price inflation is up 9.2% during August, however this is the slowest rate of growth seen in the last three months.

"Despite, the signs of house prices slowing down, the average house price in Scotland is £204,362, a new record high, and up by 9.4% over the last year.

"North Ayrshire, Argyll and Bute and West Dunbartonshire have enjoyed the best property price rises over the past year.”

Ross McMillan, owner at Glasgow-based Blue Fish Mortgage Solutions said that despite slower growth, demand was like to continue saying: “Though the property market remains in a relatively healthy state for now, there's nowhere near the frenzied activity that has defined the market during the past couple of years.

"We're typically now seeing just two or three buyers competing for a property rather than two dozen, as was the case this time last year.

"While there is still a general lack of supply, sellers' expectations are also becoming more reasonable and generally more in line with valuations.

Speaking on the picture across the UK as a whole, Kim Kinnaird, director of Halifax Mortgages, said the latest monthly increase is “relatively modest” compared with recent times, adding: “Over the last year the rate of monthly house price inflation has averaged around 0.9%.

“The typical house price reached another record high in August – as it has done in seven out of the eight months so far this year.

“However, the annual rate of growth dropped to 11.5%, from 11.8% in July, the lowest level in three months.

“While house prices have so far proved to be resilient in the face of growing economic uncertainty, industry surveys point towards cooling expectations across the majority of UK regions, as buyer demand eases, and other forward-looking indicators also imply a likely slowdown in market activity.”

Ms Kinnaird added: “With house price-to-income affordability ratios already historically high, a more challenging period for house prices should be expected.

“However this should be viewed in the context of the exceptional growth witnessed in recent years, with average house prices having increased by more than £30,000 over the last 12 months alone.”