House prices in Scotland are growing faster than in England and Wales and in October increased at their strongest rate since March 2015, the latest index data shows.
Prices increased by 1.5% month on month, taking the price of an average property to £172,561 and are now 2.9% higher than a year ago, according to the Your Move/Acadata index.
The index also shows that sales were down 3.6% in the third quarter of 2016 compared to the same period in 2015 but comfortably ahead of the two preceding years. It says that transactions have recovered strongly since their slump following the large number of purchases brought forward ahead of April’s additional 3% Land and Buildings Transaction Tax (LBTT) surcharge on second homes.
The price growth was helped by a revival in prime property in particular. Edinburgh, for instance, with an average price of £252,488 in October, had seen sales of properties in the £325,000 plus sector fall 17% in the first half of 2016 but in the third quarter they were up almost 8% on the same period last year and up 32% quarter on quarter.
Overall, sales of properties in excess of £325,000 were up 35% in the third quarter against the second, while transactions of all properties over the period were up less than half that, rising 16%.
The strong interest in prime property is reflected in gains in house prices in the most expensive areas with Edinburgh up 8.7% on an annual basis, East Renfrewshire up 10.4%, and East Dunbartonshire up 16.5%.
The strength in the Scottish market is broad based, though. In West Dunbartonshire prices increased by 18.6% to an average of £130,304 in October while in East Dunbartonshire prices were up 7.3% to an average of £245,427 and are up 12.1% year on year.
In Orkney prices increased by 11.3% to an average of £154,583 month on month and prices are up 18% year on year. Indeed, out of 32 local authority areas, some 24 continue to show growth on an annual basis.
Even the cheaper areas have seen growth. In Na h-Eileanan Siar, the cheapest area of Scotland with average prices of £109,934, has seen prices rise 10.7% annually while in the Shetland Islands prices are up 12.7% year on year and in East Ayrshire up 9.9%.
‘Scotland is proving to be a resilient market. With the recovery of interest in prime property, we’re seeing areas of strong growth across all price points,’ said Christine Campbell, Your Move managing director in Scotland.
According to Alan Penman, business development manager for Walker Fraser Steele, one of Scotland’s oldest firms of chartered surveyors and part of the LSL group of companies, said that very little seems to be able to dent the Scottish market at the moment.
‘So far it’s come through the uncertainty over Brexit relatively unscathed, and now it looks like it’s bouncing back well from the stamp duty changes. It’s been a confident display this year,’ he added.