Scottish housing market still leads field across UK

The latest official house price statistics show that Scotland’s property market continues to outpace England and Wales producing above average growth despite the same financial issues affecting both sides of the border. The most recent data from the monthly house price index shows that between February 2024 and January 2025 average house prices in Scotland increased from £175,976 to £187,434. This was an annual increase of 6.5 per cent compared to a rise of 4.9 per cent in England and Wales over the same period.

Within these figures there were substantial differences in price rises with East Renfrewshire recording the highest increase of £24,461; Edinburgh rising by £24,071; Stirling up £19,837; East Lothian increasing by £17,172; and East Dunbartonshire up by £16,311.

There were also two areas which recorded a fall in average prices, with Argyll and Bute falling £865 and Dundee dropping by £181. The next three lowest increases were in Aberdeen which rose by just £1,798; Clackmannanshire increased by £2,018; while Aberdeenshire was up £2,113.

What is perhaps most interesting is that there is a near £200,00 price difference between Edinburgh – which is the most expensive place to buy a home – and Inverclyde, which is the cheapest area. Average prices in the capital are now £295,133 while in Inverclyde prices are at £112,849.

There have always been more sought-after areas where incomes are higher, demand is greater, and more people from all parts of the country are drawn. What is changing is that Edinburgh and its surrounding areas are all becoming much more expensive than the majority of the rest of Scotland.

There is a clear price gap developing around the capital and its surrounding areas with Edinburgh. Midlothian and East Lothian the first, second and fourth most expensive areas to buy in Scotland.

While there were 15 areas in Scotland recording an increase of over £10,000 it is clear that prices around Edinburgh are increasing at a considerably faster rate despite average prices already being the highest in the country.

Whether this is healthy for the wider economy is open to question but there is little doubt that demand in the Central Belt far outstrips supply despite the areas around Edinburgh already accounting for 40 per cent of the total number of newbuild starts in the last year.

As ever while some parts of Scotland are booming others appear to have fairly static price rises. Rural areas such as Argyll and Bute, Clackmannanshire, Aberdeenshire and Highland have all seen average prices either fall or increase at a rate below inflation over the last year.

These figures show that the Scottish housing market remains in rude good health for the most part recording annual price growth greater than historic trends. This may continue aided by lower mortgage rates later this year coupled with the easing of lending criteria. However, the exacerbating influence will be the effect that US tariffs could have on exports and consequently on Scottish jobs. Any impact on the jobs market would have a serious impact on housing and it remains to be seen what will happen in the coming months, but it is clear that house prices, along with almost everything else in our economy, will be dependent on what happens as a consequence of Trump’s tariffs and the UK Government’s response to them.