News: Scottish house prices show strong growth

Thu, 18 Feb 16

Property prices in Scotland ended 2015 at a sprint, recording the fastest annual rise in seven months.

Prices rose 0.8 per cent month-on-month in December 2015 to reach an average price of £170,641 - 2.5 per cent higher than the end of 2014. Not everywhere enjoyed rising values, though: Aberdeen saw the steepest house price drop over 2015, with prices dipping 6.8 per cent, as falling oil prices dampened demand. The city has now slipped to sixth in the house price rankings, down from third at the end of 2014.

"The increase over the year to December is still below the 4.4 per cent rise in 2014, as growth was skewed by the introduction of the Land and Buildings Transaction Tax (LBTT)," says Christine Campbell, Your Move managing director in Scotland.

While property prices have been held back by higher LBTT rates at the top of the market, though, the tax did spur a surge in Scottish home sales. December saw the highest property sales for eight years, up 21 per cent on the same month in 2014. Total sales for the year were 6 per cent higher than 2014, in stark contrast to England & Wales, where sales are down 2.6 per cent year-on-year, according to Your Move.

The million-pound property market has also begun to recover after the introduction the LBBT.

"Overall, there has been a 30 per cent annual increase in the sale of high value homes in 2015," notes Campbell. "Half of these sales came in March, as owners rushed to beat the introduction of the LBTT. This was followed by a short-term drought which saw the average number of million pound sales fall to just 3.5 per month in the four months immediately after the tax rise. However, the top end of the market is firmly in recovery, with the number of £1m sales increasing to an average of 10.5 a month in the last four months of the year, not too far off 2014’s average of 12 sales each month."

The latest  Home Asking Price Index also showed a jump in Scottish house prices but warned that optimism amongst sellers may not be reflected by the real market dynamic as marketing times remain very long north of the border.

See also: February 2016 HAPI

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