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The average house price of £200k is about to be reached

24th Oct 2024
David J Alexander
Sales

The most recent statistics from the official monthly house price index shows that between September 2023 and August 2024 average house prices in Scotland increased from £186,970 to £199,971. In England and Wales average house prices rose by only £8,508 over the same period. It is an absolute certainty that Scotland will have average house prices over £200,000 in the next month or so.

Price increases have been growing steadily since the start of the pandemic in March 2020. In the intervening 54 months average prices have risen by £49,346 which is equivalent to an increase of £913 every month. This is a 32.8 per cent rise over the last four-and-a-half years.

Across Scotland there were substantial variations in price rises, with East Renfrewshire recording the highest increase of £27,270; West Lothian higher by £18,919; Edinburgh rising by £17,661; Midlothian up £15,410; and the Borders up by £15,324.

There was only one area which experienced a fall in value last year which was Argyll and Bute, where prices were down £1,747. The next four lowest increases were in Dumfries and Galloway which rose £665; Fife increased by £1,795; East Dunbartonshire up £1,985; and Aberdeen higher by £2,238.

Even more astonishing is the fact that while almost every part of Scotland recorded an increase in average prices eight areas had an average price rise of over £10,000 during the twelve-month period. In East Renfrewshire prices have increased by £524 every week for the entire year.

The biggest increases have all occurred around our two main cities in the central belt, where demand seems to be far outstripping supply. People are still drawn to live and work in or near Edinburgh or Glasgow with all of the work, leisure, and entertainment benefits they offer. With the exception of Highland, which had a near £10,000 increase, all of the static prices and the single price faller are once again in rural areas such as Argyll and Bute and Dumfries and Galloway.

The Scottish housing market continues to outperform our neighbours south of the Border and produce really quite strong growth. Normally you would expect annual increases of between two to three per cent but average property prices in Scotland are running at double that rate of growth.

Many parts of Scotland continue to attract buyers from across the country, the rest of the UK and overseas. This high level of demand is ensuring that prices remain very strong. Added to this is the relatively low rate of newbuilds reducing supply and you have circumstances which can only result in rising prices in the coming years.

With interest rates likely to fall in the coming months, employment remaining high, and the anticipation of higher economic growth I believe these increases in Scottish house prices are likely to continue in the coming year.

 

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