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20 Jun

e.surv Director Richard Sexton Comments on the Latest Scottish House Price Index

Posted 20/06/2012 by: Reeds Rains

The April 2012 Scottish House Price Index from LSL Property Services/Acadametrics has been released today, providing a measure of the average house price in Scotland for April 2012.Scottish house prices rise for the second successive month as recovery continues

  • House sales 12% higher in first four months of 2012 compared to 2011
  • Prices recover to same level as 5 years ago
  • Strong annual price rises in Aberdeen and Edinburgh

 

Data from the Scottish House Price Index for April 2012.

Richard Sexton, director of e.surv chartered surveyors, part of LSL, comments as follows in the latest Scottish House Price Index Report from LSL Property Services and Acadametrics published 20th June 2012.

“The housing market is coping admirably with the treacherous economic conditions swirling around it. Prices have risen for the second month in a row, suggesting the market may have turned a corner following a difficult winter period when prices fell for four consecutive months.”

“‘Cautious optimism’ describes the prospects for the market over the coming months. Demand for moving home is still strong, despite buyers having to piece together the big deposits needed to access affordable mortgages. Plenty of buyers are sick of being stuck in expensive rental accommodation. Rather than line the pockets of landlords, many of them have decided to roll up their sleeves and find a deposit.”

“But it was a lack of mortgages, rather than weak demand, which has paralysed the market in the past and dragged down prices. That’s why all eyes will be on the economy and the eurozone. Borrowers will be hoping banks show enough resilience to resist the effects of a gridlocked economy and the deteriorating situation in the eurozone. The prospects for the housing market will be inextricably linked to decisions made in Berlin, Madrid and Athens. If investor confidence in the euro disintegrates completely, and Greece makes a messy exit from the single currency, it could restrict banks’ ability to grant mortgages, particularly to first time buyers.”

“On a regional basis, prices are much more varied. Edinburgh and Aberdeen have seen hefty price increases compared to April last year whilst, on the flip side, homeowners in Glasgow and Ayrshire have seen great chunks chiselled off the value of their homes during the same period. A word of warning: despite prices increasing nationally, 18 of the 32 local authorities in Scotland have seen house values fall over the last year. Some areas have struggled more than others with the effects of the downturn and public sector austerity. Local economies are still reeling from the effects of high unemployment and weak private sector investment. This has pushed down house prices well below the national average.”