The average house price in Scotland rose by £952, or 0.7%, in September on a seasonally adjusted basis, and now stands at £144,253, the latest house price index for Scotland from LSL Property Services/Acadametrics has revealed.
Over the last year, monthly house prices north of the border have increased on five occasions, fallen six times and remained static once. On an annual basis, average prices are now up £647, or 0.5%, over the year.
This is the first time that the annual rate of change in house prices has been positive since January 2011, some 32 months ago.
Richard Sexton, director of e.surv chartered surveyors, part of LSL Property Services, said: “The Scottish housing market is being revitalised: for the first time since January 2011 the annual change in prices has been positive, marking a significant step change. Stable price levels are helping the market recover; prices have risen by £952 in the past month and are £647 higher than a year ago. Sales levels are also following suit, now at their highest level for five years – a dramatic boost that is helping propel the property market upwards.
“The main driver of this increase is down to the phenomenal rise in first-time buyer activity at the lower end of the market. Lenders have eased conditions, banks are more confident and generally the mortgage market is buzzing. First-time buyers have witnessed a plethora of top mortgage deals and greater product choice, and low interest rates are giving people more confidence to buy. The Government’s launch of its own version of the Help to Buy equity loan scheme has given the market a real helping hand.
“The general economic recovery has restored and renewed consumer confidence, and many would-be movers in Scotland are now more optimistic in their ability to sell their existing home and buy elsewhere. As a result, the whole market has become far more fluid. Before, the average house price of £97,000 paid by first-time buyers was lower than the average price for the market as a whole and movement at the bottom end caused prices to fall. Now it’s activity from second-time buyers and other movers that is placing upward pressure on prices and this will drive the recovery forward. With sales up by 22% over the last three months compared to last year, green shoots are emerging in the property market left, right and centre.
“Before we get swept away with the positive news, it is important to stress that the Scottish property market has a long way to go. For instance, there’s the possibility that interest rates will rise and a concern that higher stamp duty on the most expensive properties could put a brake on activity. All eyes will be on the Scottish Government’s plans to focus on affordable housing across Scotland which is vital if the market is to progress further.”
