Help to buy credited with recovery of Scottish housing market

House prices in Scotland have climbed £5,584 in the last 12 months, with all seven cities in the country experiencing growth in the past year.

The LSL House Price Index for Scotland revealed that the average house price stood at £160,678 in February 2014, up 3.6 per cent on the same month last year and an increase of 0.2 per cent from January.

Prices in Inverclyde saw the greatest yearly increase, climbing by 16.1 per cent since February 2013.

Richard Sexton, director of e.surv chartered surveyors, comments: “Help to Buy has been the spark driving the engine of recovery for the Scottish housing market. Since launching at the tail end of 2013, the scheme has helped thousands get a foot on the ladder. With sustained growth taking hold, there are now signs that the independence debate is less likely to rock the housing recovery boat. However, there’s still some uncertainty surrounding the ramifications of an independent Scotland for the banking sector. The potential fiscal impact may be felt in mortgage accessibility and employment stability, which in turn could have a knock-on effect on housing.

“Over the past year we’ve witnessed average prices climb by over £5,500, with Inverclyde seeing the greatest annual growth of all, at 16 per cent – with the region clearly benefitting from its close proximity to Glasgow. In a sign of the widespread revival, all seven Scottish cities have also seen price rises from last year. This urban renaissance is being driven by first-time buyers benefitting from Help to Buy, typically taking the plunge in vibrant cities. Aberdeen in particular has seen the average house price climb by 12 per cent over the past twelve months – it has its own micro-economy. The same trend is being seen across metropolitan areas in England, with places like Manchester also seeing positive growth.

“However, there are also indications that the first-time buyer express is starting to lose some steam. In the three months to February, flats – the archetypal home of new buyers – saw the smallest uplift in sales. Last summer the opposite was true.

“The next few months will be a testing time. The debate is sure to ramp up in intensity as we edge ever closer to September and all eyes are on Mark Carney’s next move for housing. But for now Scotland can simply revel in a revived property market.”