The average house price in Scotland hit a fresh high of £211,029 at the end of August, says Walker Fraser Steele and Acadata.
This represents a 1.8% monthly rise, or another £3,685 since July, and a 12.1% annual rise – “and there is no sign of imminent let-up,” says business development manager Alan Penman.
Added to this is the news that all 32 local authorities have noted price rises over the year so far, and that transaction levels in August were at a seven-year high.
However, the price rise from June to July stood at 2.7% and was a six-year high so the latest increase is, as Acadata senior housing analyst John Tindale puts it, “a slight softening.”
Tindale continues: “One of the main reasons for the current upward movement in prices is a result of the lifestyle changes associated with working from home, which has brought about a shift in housing preferences to larger properties, with space for home-working becoming a prime requirement.
“The demand for larger premises has continued throughout August, and for some includes moving to Scotland from London, or from other major cities in the UK and beyond.
“However, the number of larger homes in Scotland available for purchase remains thin, with strong competition for those properties that do come onto the market, helping to keep prices high.”
Regionally, the biggest annual rise was in the Scottish Borders, with an average increase of 28.4%, “which… reflects the fact that the mix of homes that have been sold in this area has trended towards the more expensive end of the market,” explains Penman.
Tindale, meanwhile, charts out the land and building transaction tax (LBTT) affected things: “Prices reached a mini-peak in March 2021, immediately prior to the ending of the LBTT tax holiday on 1 April 2021. Average prices then started to fall, as buyers of high-value properties reduced in number.
“However, the reduction in high-value sales only continued through April and May, with June and July seeing a return of the higher-value purchases. This was perhaps assisted by those who had decided to move away from buying properties in England, where the threshold on tax savings had reduced to £250,000 at the end of June.
“In July and August 2021… prices once again regained their earlier momentum, with monthly price increases more than matching those experienced during the final quarter of 2020, despite the savings arising from the LBTT tax holiday no longer being available.”
The data adds that the size of the sales market between 2019 and 2020 reduced by 14%, but in the first eight months of 2021, sales are up by 12% compared to 2019.
