Despite rises in each of the last three quarters, on an underlying annual basis, Scottish house prices have fallen by 3.3 per cent. The rise in the latest quarter is much lower than the +5.9 per cent of the previous quarter. The number of house purchase transactions remains low with 19 per cent fewer transactions than in the last quarter. The number of house purchases reached a low point in February but recovered in March and April, but is still around half the level witnessed before the recession.
Price movements in the latest quarter remain volatile. Though Dundee is reporting a significant annual rise at +10.7 per cent, this masks the volatility seen in quarterly changes shifting from +16.3 to -10.8 per cent in the last two quarters. Dundee house prices are now at levels last seen 21 months ago. Most areas continue to report an annual fall in prices ranging from -2.5 per to -8.2 per cent
Professor Donald MacRae, chief economist, Lloyds Banking Group Scotland, said: “The Scottish economy entered recession in quarter three of 2008 and recorded five consecutive quarterly falls in output. Scotland exited recession at the end of last year with growth of 0.2% in the last quarter having experienced one quarter less of falling output than the UK over the whole of the recession.
“Consumer confidence continues to recover from the low at the end of 2008 but is still below pre-recession levels. Retail sales are increasing at an annual rate of 3.9% in March while the volume of housing sales has recovered from the low point of February this year.
“The level of mortgage availability including for first time buyers has increased while the cost of borrowing remains low for many mortgage holders. The rise in the average Scottish house price identified at the end of last year has not been maintained into 2010. However, activity has picked up from the low levels of the winter months. The Scottish housing market continues to recover but slowly.”
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