 Scotland's property boom is over with the average price of a house falling by £411 a week, or nearly £60 a day, over the last three months.
But despite the quarterly fall, all areas of the country are still showing healthy annual price increases of up to 30 per cent, with Aberdeen remaining Scotland’s top property hot spot.
The latest Lloyds TSB Scotland Scottish House Price Monitor says prices in Scotland will level out during 2008.
The average price of a house in Scotland fell 1.6 per cent to £163,211 during the quarter to the end of January, but separate figures reveal annual house prices increased by 14 per cent between January 2007 and January 2008.
Three months ago, the average Scottish house price was £168,559, giving a fall of £5,348 over the 13 week period, the first quarterly fall since 2001.
The figures are released only two weeks after it was revealed Scots face the prospect of losing their homes as they struggle to pay the mortgage.
There was a 14 per cent jump in applications to be classified as homeless over the last year as higher house prices, rising interest rates and utility bills took their toll.
Figures showed the number of people approved for mortgages had reached a 23-year low.
It was also revealed there were 913 applications north of the Border to be classified as homeless last year because of mortgage defaults, up 14 per cent on the previous year.
The Lloyds study reveals a variation in house prices across the country, with Dundee and Edinburgh the only two cities to record a slight increase during the quarter.
Edinburgh remains the most expensive place to live with prices at an average of £214,430, after a 0.9 per cent rise in the quarter.
Over the last year, prices in the capital have risen by 18 per cent.
Dundee continues to catch up with prices increasing 1.5 per cent in the quarter to an average of £154,599, marking a 20.3 per cent rise over the year.
Prices in Aberdeen have fallen the sharpest, recording a 4.1 per cent drop, going below the £200,000 barrier to an average price of £196,425.
The report says Glasgow prices began to level out two years ago. The quarterly price movement is a fall of 4.9 per cent to an average price of £151,533.
Of the areas outside the cities, only the south west is showing a quarterly rise.
Prices have edged up 1.4 per cent, giving an annual increase of 10.3 per cent with prices at an average of £152,387.
Prices in the central Scotland, Perth, and Fife, excluding have lost some of last year’s gains with a quarterly fall of 5.5 per cent. This still gives an annual rise of 12.2 per cent with house prices averaging £147,127.
The north of Scotland, excluding Aberdeen, reflected the trend inside the city of Aberdeen with a quarterly drop of 2.1 per cent. On an annual basis the gain is a healthy 23.8 per cent with average prices at £180,736.
Prices in the south east of the country, excluding Edinburgh, fell by 5.4 per cent in the quarter. This gives an annual gain of 9.4 per cent with prices at an average of £158,177.
The report shows that, across Scotland as a whole, flats rose 2.1 per cent in the quarter, giving an increase of 12.2 per cent over the last year, to an average £128,089.
The average price of a terraced house fell by 3.0 per cent during the quarter, but still rose by 12.9 per cent over the year, to an average of £136,333.
Semi-detached houses also dropped in price by 3.0 per cent during the quarter to give an annual gain of 15.6 per cent at an average of £161,875.
Prices for detached houses and bungalows fell by 1.3 per cent in the quarter, giving an annual gain of 16.3 per cent annually, to an average of £251,009.
Professor Donald MacRae, chief economist with Lloyds TSB Scotland, said: "The boom in Scottish house prices has come to an end.
"Although this is the first quarterly fall in Scottish average house prices for seven years, all areas continue to show an annual underlying price increase.
"The market is showing sensible adjustment after years of price gains above inflation."
Professor MacRae predicted that demand for houses in Scotland was set to increase: "As the total population in Scotland increases with fewer people per household, people living longer and marital break-ups, the number of households in Scotland is projected to increase over the next 20 years.
"Aspirations for home ownership show 86 per cent of people would prefer to own their own house. There is enough demand for housing to put owner occupation beyond the current level of 67 per cent.
"The prospects for the Scottish housing market are for a plateauing of prices during 2008 following the significant gains in the last few years. The Scottish housing market is pausing for breath."
Source: www.dailyexpress.co.uk |
