On an annual, underlying basis Scottish house prices have increased by 2.4%, it shows. In the three months ending April 2011, the quarterly price index for the average domestic property in Scotland fell by 3.6%, reversing earlier gains. Following mix adjusting, the average Scottish house price is now £153,335.
As with last quarter's Monitor, the latest house price movement has been generated from a market with a low number of sales, it points out. The number of house purchases recorded in this quarter's Monitor is 6% down on the last quarter and 18% below the same quarter of last year.
For the market as a whole, Scottish house purchases in March 2011 were 3.1% less than March of the previous year. However, the number of transactions in March was 42% up on the previous month. The number of housing transactions in the Scottish market continues to be around half of pre recession levels.
‘The Scottish economy exited recession at the end of 2009. A slight fall in output in the first quarter of 2010 was followed by robust growth of 1.3% in quarter two and trend growth of 0.5% in quarter three, before a weather induced fall of 0.4% in the last quarter. Most indicators, including the Bank of Scotland PMI, point to a resumption of growth in the first quarter of this year,’ said Donald MacRae, chief economist, Lloyds TSB Scotland.
‘The Scottish housing market has adjusted to the recession with a halving of sales and a period of volatile price movement over the last three and a quarter years. Average house prices in Scotland are now very close to the levels of four years ago,’ he explained.
‘Consumer confidence has fallen due to high levels of retail price inflation in excess of increases in earnings squeezing disposal income. The slow recovery from recession is being expressed in the housing market, principally through low levels of sales and a return to the prices of four years ago,’ he added.
A separate report shows that fewer residential properties are being built in Scotland. Figures from Scotland's Chief Statistician show that there were 5% fewer houses completed in the last quarter of 2010 than in the same quarter last year. In 2010 as a whole there were 16,852 completions, a 5% reduction compared with 2009.
There were 29% fewer houses started in the last quarter of 2010 than in the same quarter last year. In 2010 as a whole there were 14,498 starts, an 11% reduction compared with 2009.
It also shows that there were 6% fewer private sector homes completed in the last quarter of 2010 than in the same quarter last year. In 2010 as a whole there were 11,178 completions, a 3% reduction compared with 2009.
There were 32% fewer private sector starts in the fourth quarter of 2010 than in the same quarter last year. In 2010 as a whole there were 8,980 starts, a reduction of 3% compared with 2009.
