Scotland’s house prices back to pre-recession levels

Average house prices in Scotland are approaching the peak levels seen before the recession, according to a report.

Picture: Gareth Easton
Picture: Gareth Easton

With an average price of £161,873 recorded in March, the figure is just 2.4% below the level seen in April 2008.

The latest statistics suggest the recovery of the housing market in Scotland is “more entrenched” than in northern England, experts concluded.

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But they added a note of caution, saying there are parts of the country where the “feel-good factor” has not yet been seen.

The figures were contained in the house price index for March from LSL Property Services and Acadata.

It found the average house price for that month was up 0.7% on February’s level and up just over 4% when compared to March 2013.

Overall, average prices north of the border are up £6,435 in a year, the highest annual rise since October 2010.

Donald MacLellan, chairman of Walker Fraser Steele Chartered Surveyors, part of LSL, said: “For households all across Scotland, there is light at the end of the tunnel.

“The average price in Scotland is now only 2.4% (£3,900) below its pre-recession April 2008 peak.

“The recovery in Scotland has now taken a stronger grip than in the northern most regions of England. Just south of the border lies a reminder of the challenging road back from the depths of the recession, with the average price in the north of England still lingering 8.1% below their 2007/2008 pre-crisis peaks.

“As the independence vote looms on the near horizon and the debates become more ferocious, it will be interesting to note if this has any impact on current trends.”

The Help to Buy scheme and buoyed demand from first-time buyers have been the catalysts spurring the Scottish market on, Mr MacLellan said.

On an annual basis, average property prices have risen in 66% of all areas of Scotland. The “flagship success story” is Aberdeen, where average house prices reached a new record of £219,117 in March, after 17% annual growth.

In Inverclyde, new waterside developments and a fresh wave of housing stock have helped raise average prices in the area by almost 20% over the past year, the highest annual growth experienced in Scotland.

Mr MacLellan went on: “The revived confidence at the bottom of the property ladder is rising up through the rungs, emboldening home movers to take the plunge after years of hesitation.”

But he added: “However, there’s still a note of caution and the recovery still requires nurturing. There are corners of the country where the ‘feel-good’ factor has yet to be seen.

“In Midlothian, average house prices have dropped 10.8% annually and two of Scotland’s seven cities suffered monthly house price falls in March 2014.”

Commenting on the figures, Acadata chairman Dr Peter Williams said: “In Scotland only Aberdeen City has set a new peak price, although nationally, the average house price is only 2.4% from its peak. That figure compares with the north and north west of England being 8.1% and 7.2% from their respective peaks, perhaps suggesting that the recovery of the housing market in Scotland is more entrenched than in the northern most regions of England.”