The average price of property in Scotland increased by 4.3% year on year in August and by 1.3% month on month, the latest index data shows.
This takes the average price of a home to £144,561, according to the data from the Registers of Scotland. This compares to a UK average of £218,964, which was an increase of 8.4% over the year and an increase of 1.3% compared to the previous month.
The data also suggests that the slowdown in sales which saw transactions fall by 7.4% year on year is now receding with sales up 20.9% month on month.
‘We still may be seeing some impact from changes in Land and Buildings Transaction Tax that came into effect in April 2016 for additional dwellings, such as second homes and buy to let properties,’ said Registers of Scotland’s director of commercial services, Kenny Crawford.
‘These changes are likely to have contributed to the significant increase in volumes seen in March and to the subsequent lower volumes that have followed in April, May and June,’ he added.
The top five local authorities in terms of sales volumes were the City of Edinburgh, followed by Glasgow City, South Lanarkshire, Fife and North Lanarkshire while the biggest price increase over the last year was in East Renfrewshire where the average price increased by 12.7% to £219,511. The biggest decrease was again in the City of Aberdeen where prices fell by 8.7% to £175,922.
Crawford pointed out that in the five months since June 2016 Aberdeen has recorded the biggest annual percentage decrease in average price of all of Scotland’s local authority areas for each month.
‘Overall, average prices in the area have fallen consistently over the last 15 months when comparing monthly average price figures with the figures for the same month in the previous year,’ he explained.
Across Scotland, all property types showed an increase in average price when compared with the previous year, with semi-detached properties showing the biggest increase of 5.6% to £151,917.
The average price for a property purchased by an owner occupiers was £173,859, an increase of 4.7% on the previous year while for first time buyers it was £116,383, an increase of 3.9% on the previous year.
The average price for a cash sale was £132,784, an increase of 3.8% year on year while the average price for property purchased with a mortgage was £150,020, an increase of 4.6% on the previous year.
Simon Brown, partner and head of residential sales at CKD Galbraith, said his firm is seeing high levels of demand for property at all price points, with particular interest throughout Scotland in rural properties with small blocks of land offering an outdoor lifestyle to buyers.
‘Scottish property is currently presenting greater value for money than many other parts of the UK. Whilst the average price of property in Scotland has remained fairly consistent throughout 2016, property prices in England continue to rise. Scotland offers good value at all levels of the residential market for those selling in England and moving north to take advantage of the lifestyle and deals on offer,’ he explained.
‘The uncertainty surrounding the Brexit vote earlier this year has all but disappeared from the market. Therefore, we would urge sellers not to hold off selling over the winter months as the market is proving to be extremely competitive and there are serious buyers out there willing to act fast to secure the right property,’ he added.
The firm has reported a 30% increase in the volume of sales achieved compared to the previous quarter of 2016. Local buyers from across Scotland accounted for 58% of sales during the third quarter, whilst 37% came from across the rest of the UK and 5% were international buyers.
According to Michelle Grant, investment director at Grant Property, low interest rates and a shortage of stock have continued to drive demand and push up prices. ‘The reduction in volume is in line with what we have experienced in key markets, with notes of interest on central belt properties ranging from 10 to 20 at closing,’ she said.
‘With fierce competition from both domestic and overseas investors, properties are not on the market for long and there is a very quick turnaround from marketing to selling. Prime areas in Edinburgh have proved particularly popular with most properties selling for 15% to 20% over home report valuation,’ she added.
