Falkirk beats London for house price rises

SCOTLAND has seen an annual fall in house prices for the second year running and remains one of the most affordable areas in the UK, according to a property prices survey.

But Falkirk, in central Scotland, is among 11 towns which outperformed London in a list of the biggest house-price percentage rises over the year.

Within easy commuting distance of Edinburgh and Glasgow and commercial centres nearby, Falkirk came second on the list of house price rises, with a 12 per cent gain to make the average house worth £126,548.

Woking was named the UK’s best price performer in the Halifax Town House Price Survey of the UK, with prices typically rising by 16 per cent over the year to average £299,654.

Halifax said Falkirk’s relatively low average property price makes it more affordable than many other areas close to Scotland’s two largest cities.

Martin Ellis, housing economist at Halifax, said: “Whilst house prices nationally have been largely unchanged in recent months, there have been significant differences in performance in towns across the country.

“The two towns recording the biggest rises are both within easy commuting distance of major commercial centres.

“In contrast, the majority of towns that have fared worst in house price terms are outside southern England where economic conditions have tended to be less favourable.”

Meanwhile, a report from the Nationwide, released yesterday, revealed that nine out of 13 regions in the UK recorded a house price rise over 2011, in a year of contrasting fortunes ranging from a 5.4 per cent increase in London to an 8.9 per cent drop in Northern Ireland.

The report flagged up that Scotland with its second consecutive annual fall in prices remains one of the more affordable areas of the UK, with a house price to earnings ratio of 4.5.

The annual increase across the UK was described as a “surprisingly resilient” 1.1 per cent, pushing the price of a typical home to £163,822 over the year, despite a 0.2 per cent month-on-month fall in December.

Nationwide said that despite the encouraging figures in the face of high unemployment and “anaemic” economic growth, demand and supply remain weak, with mortgage approvals standing at around half their long-term levels.

Its report said Northern Ireland and London stood out over the past 12 months, with the sharp drop in house prices felt by Northern Ireland being a marked contrast to the relative stability seen overall.

Robert Gardner, Nationwide’s chief economist, said: “The 1 per cent rise in house prices recorded over the past 12 months can hardly be described as a strong performance, but against a backdrop of anaemic economic growth and a deteriorating labour market, UK house prices are surprisingly resilient in 2011.”

He continued: “Although high rates of unemployment, falling real wages and the uncertain economic outlook kept many potential homebuyers on the sidelines, the supply side of the market was similarly squeezed.

“Thanks to continued low interest rates, the number of forced sales remained low.

“Together with a dearth in building activity in recent years, this prevented a glut of unsold homes from accumulating on the market.

“This meant that although demand and supply were both weak, they remained relatively well-matched.”