News: Scotland gaining on London

Mon, 22 Oct 07

The annual rate of house price inflation in Scotland is now 14.2% above the UK average of 10.7%, according to the latest Quarterly Scottish House Price Index from Bank of Scotland....

Prices in Scotland rose by 0.7% in Q3 2007. The average price of a house in Scotland is currently £141,158. This is 29% less than the UK average of £198,898. Greater London prices are now just 2.3 times higher than those in Scotland, compared with 3.0 times in Q3 2002.

Inverurie in Aberdeenshire saw average house prices rise by 35% to £218,580, making it the best performing town in Scotland over the last 12 months. Greenock in Inverclyde followed, with a 32% rise to £133,578 recorded the largest increases in house prices in Scotland over the past year.

Expensive Edinburgh

Edinburgh remained the most expensive place to buy a house in Scotland, with prices up 18% over the year to an average of £228,212. Edinburgh, Inverurie and Aberdeen (£200,721) are the only three towns and cities in Scotland with an average price of over £200,000.

Clydebank is the most affordable town in Scotland. Prices rose 11% over the year to £120,180. On a local authority level, East Renfrewshire (£222,995) is the most expensive, while Aberdeenshire saw the highest average house price rise of 26%, to £203, 740.

Martin Ellis, Chief Group Economist for Bank of Scotland, commented: "House prices in Scotland are the still most affordable in the UK, despite an annual rise of 14.2%. This increase is well above the UK average of 10.7%. The average price of a house in Scotland is currently £141,158, which is 29% less than the UK average of £198,898.

“Because of this large increase in prices over the past year, the gap between prices in Scotland and London has narrowed to 2.3 times, down from 3 times in the third quarter of 2002. The Aberdeen area has seen some impressive house price growth in recent years. In 2001 the average price of a home in the city was £84,845.

Ripple effect

Mr Ellis continued: This has risen by more than 137% in the intervening period. Partly because of higher prices in Aberdeen, we are now seeing something of a 'ripple effect' to the rest of Aberdeenshire. Inverurie, with its easy commuter links to the Granite City, has been the major beneficiary over the last 12 months. Prices there are up 35% to £218,580. Peterhead was not far behind, with average prices up some 28% to £151,785.

There has also been a large amount of high quality, new build properties onto the market in Aberdeenshire in recent years, which has contributed to the rise in prices. The local authority is now one of the few in Scotland to have an average price over £200,000.

Of Scotland's cities, Edinburgh remains the most expensive (£228,212) and Aberdeen saw the highest average price rise (25%). Average house prices in climbed 18% in Glasgow (£169,474) and 14% in Dundee, Inverness and Stirling (£152,050, £172,691 and £171,072 respectively)."

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