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Scottish property market continues to recover

Prices went up 5.9% in the three months to the end of January compared with the previous three months, according to the latest real estate index from Lloyds TSB Scotland. Dundee and Edinburgh led the way with quarterly rises of 16.3% and 11.4% respectively.
The report shows that although house prices are now rising once more, on an annual basis they have fallen by 6.8%. Following four quarterly price falls and now two consecutive quarterly rises, Scottish house prices have regained the level last seen at the end of 2008.
However, the number of property transactions is still around half of the levels recorded before the onset of the recession.
All areas are still in negative territory compared with a year ago from -2% in Dundee to -12.1% in Glasgow and price movements in the latest quarter remain volatile.
Prices of detached properties have fallen in every quarter for the last two years but this has now reversed with an increase of 12.6% in the last three months. This price rise may have been influenced by the ending last year of the temporary lower starting limit for payment of Stamp Duty Land Tax, encouraging purchases before the year end, Lloyds TSB says.
‘The volume of housing sales has recovered from the low point of February 2009. The level of mortgage availability, including for first time buyers, has increased while the cost of borrowing remains low for many mortgage holders,’ said Donald MacRae, chief economist, Lloyds Banking Group Scotland.
‘Although a house price recovery is evident in Scotland, it is based on much reduced levels of activity.  Nevertheless, the Scottish housing market is now into recovery,’ he added.