Paul Fincham, spokesman, Halifax The housing market in Scotland remains strong with house prices increasing by 1.2% during the first quarter of 2004. They are now 16.5% higher than a year ago (UK 19.1%), with an average property price of £85,212 (below the UK average of £154,304.) House prices in Scotland have increased by nearly 40% during the past three years and most towns across the country have seen strong increases in the past 12 months.
While Scotland still has the UK's most affordable housing overall, house prices in Edinburgh are well ahead of the UK with an average property price of £169,813 (24% higher than a year ago).
The Edinburgh hotspot and that of Glasgow are causing ripple effects for towns in commuting distance as more people are priced out of markets in the big cities. Cupar (52%), Montrose (49%) Paisley (29%) and Livingston (16%) have all seen large house price increases over the year.
Renfrew has seen the biggest house price rise in Scotland in the past 12 months (53%), principally due to the ripple effect out of Glasgow as housing becomes less affordable in the city. In addition, towns like Dunfermline and Livingston are in demand as commuters look for affordable housing within commuting distance of the capital.
Affordability is clearly becoming an issue for first-time buyers in Scotland as house price appreciation makes it difficult for Scots to get a start. Of the 52 main Scottish towns, 28 (54%) were unaffordable for the majority of those buying their first homes during 2003.
The Highland region has also seen house prices rise by 30% overall, with Inverness leading the way. Over the past three years house prices on the Black Isle have risen significantly, driving up land values everywhere within commuting distance of Inverness.