House Price Index

August 2017 - Scotland leads UK house price growth

Fast Facts

  • Annual house price growth highest in UK at 4.8%.

  • More than double the growth rate in England and Wales.

  • Transactions also up on 2016 and 2015.

  • Scottish Borders lead monthly growth and grow 9.7% annually.

Headline News

  • The market in Scotland continues to defy the slowdown elsewhere in Britain. Prices grew for the seventh month in a row in August – rising strongly by 0.5%. Annual growth in Scotland now stands at 4.8%, compared to 2.1% in England and Wales.

  • The Scottish market is outpacing every other region in Britain. Only the East of England, up 4.5% annually, comes close to growth seen in the north of the UK. While prices in London are down 0.7% on an annualised basis.

  • The changes leave the average house price in Scotland at the end of August at £176,876, up from £168,726 in the same  month last year.

Quick Quotes

Christine Campbell, Your Move managing director in Scotland, said:

“Housing in Scotland continues to shake off the uncertainty we’re seeing elsewhere in the UK economy. Here, low interest rates, high employment and prices that are still affordable are supporting continued robust growth.”

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:

“Scotland’s housing market is now leading Britain and that simply reflects very strong fundamentals. It’s always dangerous to speak too soon but the market currently looks in good shape.”

Key insights

  • On a monthly basis, Scotland’s local authority areas continue to see mixed fortunes. Exactly half the 32 areas saw price rises in August, headed by the Scottish Borders, up by 5.0%, taking the average price there to £187,879. West Dunbartonshire, where prices are just £115,208, was next, with the average up 4.2%.

  • At the other end of the scale on the mainland, prices in Angus were down 4.7%. The Shetland Islands saw a bigger fall -5.1%, but low transaction volumes there often mean big swings in monthly prices.

  • On an annual basis, though, there’s much more consistency: only four areas have seen prices drop, with the biggest fall just 2.7% – in Inverclyde, following a strong 2016 as a result of sales of new build detached houses.

  • By contrast, there’s been good growth across a number of areas. Prices are up 8.8% in the City of Edinburgh (the most expensive area in Scotland, with an average price of £262,092); up 9.7% in the Scottish borders; 8% in the Orkney Islands and South Lanarkshire; and 20.5% in Clackmannanshire, although that again reflects the fact the area has few sales. A number of others also saw growth significantly above the average, including North Lanarkshire and East Ayrshire (both up 7.8%) and Midlothian (up 7.6%).

  • Low interest rates and unemployment at a 42-year low are supporting a market that doesn't suffer from the same affordability problems of London and the South East, which both lower the average in England and Wales.

  • To date, Scotland has also avoided a slowdown in transactions: May, the latest month for which we have ONS figures, shows 8,241 properties sold in Scotland. That means sales for the first five months are 2% higher in 2017 than the same period last year and up by 6% on 2015.

For further information contact: