Scotland’s over price index has risen over the past two quarters and average real estate prices increased 1.4% in the last three months ending in January of this year, but an examination of the annual underlying basis shows prices have dropped 4.2%. Experts at Lloyds TSB believe the numbers from its quarterly Scottish House Price Monitor indicate home values are peaking. Analysts point out that values are at 91% of their peak some three years ago and now there is little room for the market to move. Price volatility may continue to wear on new sales entering the market, which will in turn create a less stable real estate landscape, but it is far from the worst property sales news in the United Kingdom. For more on this continue reading the following article from Property Wire.
Average residential property prices in Scotland increased by 1.4% in the three months ending January 2012, according to the latest Scottish House Price Monitor from Lloyds TSB.
The overall price index has now risen for two consecutive quarters. However, on an annual, underlying basis, Scottish house prices have fallen by 4.2% and following mix adjusting, the average Scottish house price is now £155,528.
The Lloyds TSB quarterly report says that once again the latest house price movement has been generated from a market with a low number of sales, however, compared to the same quarter one year ago, the number of transactions in the Monitor is up by 4%.
Average house prices in Edinburgh are £188,892, down 10.8% for a year ago, followed by Aberdeen at £184,695, down by 3.9% on an annual basis. The lowest house prices are in the Central, Fife, Perth and Tayside regions, excluding Dundee, at an average of £120,445, down 5.3% year on year while in Dundee they are £129,445, up 7.8%.
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In the north, excluding Aberdeen, the average price is £176,239, down 1.1%, in the south east, excluding Edinburgh the average price is £158,849, down 2.9%, in the south west, excluding Glasgow the average is £152,647, down 1.3% and in Glasgow it is £155,435, down 9.6%.
Average prices from all areas of Scotland show a corresponding increase in volatility over the last four years.
For the market as a whole, Scottish house purchases during the last three months of 2011 were almost identical to the same period of 2010. For the month of December, the number of transactions was 3.3% up on the same month in 2010. In the last five years, the lowest number of transactions was recorded in February 2011. It seems likely that the level of activity this spring will be similar to that of last year, the report says.
‘The Scottish economy exited recession at the end of 2009 with a rise in output of 0.2%. After four quarters of rising output, GDP fell in quarter four at the end of 2010. Three consecutive quarters of growth followed with a robust rise of 0.5% in quarter three 2011. The Bank of Scotland PMI indicator has been positive for all of 2011 and is again positive for January 2012 suggesting a continuation of growth but at low levels,’ 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. Average house prices are now 91% of their peak of three and a half years ago. Consumer confidence fell further during the last quarter of last year due to a high level of retail price inflation in excess of increases in earnings, squeezing disposable income,’ he explained.
‘The Scottish housing market appears to have plateaued in both sales numbers and price movements. There is no sign of a vigorous recovery in the Scottish housing market but equally no sign of a further precipitous fall in either house sales or house prices. The Scottish housing market remains down but not out,’ he added.
This article was republished with permission from Property Wire.