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Scottish property market showing signs of turning positive

Overall prices fell in the second quarter of 2009, according to the latest figures from Lloyd TSB Scotland's latest Scottish House Price Monitor.

In the three months to 31 July 2009, the quarterly price index for the average domestic property in Scotland fell by 1.4%, but this was substantially less than the 4.3% fall in the previous quarter.

Taking seasonal adjustments into account the average Scottish house price fell from £154,727 to £152,561. On an annual basis they have now fallen by 6.2%.

The index also shows that the number of transactions is down 38% on the levels recorded for the same period last year. The number of transactions reached its lowest point in May 2009 but has since begun increasing with the number of transactions in July some 35% higher than in May.

Similarly, average house prices have increased in both June and July providing further signs of a slight recovery in the Scottish housing market, the report says.

While all parts of the country are now reporting an annual price fall, ranging from a fall of 0.5% to a decline of 15.8%, both Glasgow and Dundee have reported price rises in the latest quarter.

'The housing market reached its lowest point in May recording the lowest number of sales and transactions and it saw its lowest average price in March. But there are positive signs that not only has the bottom been reached but that a recovery is beginning to take root,' said Donald MacRae, chief economist at Lloyds TSB Scotland.

'The cost of borrowing has reduced for many mortgage holders while there is a small but perceptible increase in the level of mortgage availability particularly from first time buyers. The worst of the housing market downturn has been experienced by falling transactions and an easing of prices but no precipitous collapse. The Scottish housing market is on the turn,' he added.

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