HOUSE prices in Scotland are on the rise again, according to Lloyds TSB, despite evidence that surveyors are experiencing a fall in demand from new buyers.
The bank's Scottish House Price Monitor revealed that, in the three months to the end of April, the average house price in Scotland rose by 2.3 per cent to £163,639. Over the past year, Scottish house prices have risen by 11.6 per cent.
However,
annual increases of 26 per cent, 19 per cent and 18 per cent in the north, Aberdeen and Dundee respectively served to distort the overall average. This impression was reinforced by the latest Royal Institution of Chartered Surveyors (RICS) survey, which found that more Scottish surveyors saw a fall rather than a rise in new buyer enquiries in April. It was the first month this year in which Scotland had failed to buck the national trend of decline, said RICS.
Its findings were supported by Alasdair Seaton, a partner in chartered surveyors DM Hall, who said that in Scotland the fall in house prices was felt later than south of the Border. "Since 1998 prices have tripled across Scotland, but those prices were still lower than in the south-east of England so when problems began with the supply of mortgage funding they hit that area first."
DM Hall's own research, published this week, revealed that, while the number of homeowners looking to move has not fallen, a lack of mortgage funding – with 15,000 mortgages available a year ago, compared with around 4,000 now – means deals collapse because buyers cannot secure a home loan.
"People still want to do business, so if the money supply improves we will be back up to where we were," said Seaton. "But I would not like to see a return to some of the 100 per cent plus mortgages we had a few months ago, which probably added to the over-heating of the market."
Seaton added that, while over-supply was evident across Scotland, some areas were holding up better than others. "Aberdeen is doing well at the middle and top end , while the same goes for pockets of Edinburgh and Glasgow's west end."
The full article contains 373 words and appears in The Scotsman newspaper.
