Scottish house prices show no negative response to Independence debate
- House prices up £1,680 in January – largest monthly increase for 50 months
- Average Scottish prices rise by £6,073 – largest annual increase since September 2010
Donald MacLellan, Chairman of Walker Fraser Steele Chartered Surveyors, part of LSL Property Services, comments: “The enthusiasm of property investors suggests the Independence debate is having no impact on confidence within the Scottish housing market. Scottish prices are up £1,680 in January. Five consecutive months of rising prices indicate the market has bounced back fast as it gathers the fruits of the wider economic recovery. Whether or not the possibility of Scottish Independence throws up all sorts of question marks, such as the economic cost of a separate monetary system for Scotland, currency risks, changes to stamp duty and land tax, the property market seems currently unaffected. And whether some businesses are alarmed by the prospect of the use of a currency other than sterling, a development that might lead to a rise in transitional risks as well as large business costs, with corresponding implications for jobs, as yet there is little obvious impact. Banks such as RBS and Standard Life have threatened to leave Scotland altogether and decamp to England, possibly causing a drop in net lending. But if a yes vote for independence looked like the more probable outcome, we would expect this uncertainty to have manifested itself in property prices. As we can see, there has been no such impact on the housing market.
“2014 recorded the highest volume of sales in a January since 2008. Increased lending and mortgage availability are reaching heights not seen since before the recession as first-time buyers return to the market en masse. Mortgage finance – for those who can access it – is at its cheapest for some time. This is sustaining activity in all sections of the market, specifically buy-to-let investors and homeowners looking to upgrade. The spring market in Scotland will see more lending to first-time buyers thanks to cheaper rates, a boost in high loan-to-value mortgages and the support of Help to Buy. The lack of supply in properties in Scotland is boosting competition between new and previous buyers, propping up prices. The property market doesn’t appear to think things are set to change any time soon.”