House Prices in Scotland – Argyll & Bute See Biggest Gains

According to the latest House Price Index from Chartered Surveyor Walker Fraser Steel, Scottish average house went up by 8.4% to another record £220,870 in the year to May. House prices have gone up in the last 11 out of 12 months – taking the average house price £17,100 higher in May than the previous year.

This latest report follows the Bank of England raising interest rates five times in a row since December to 1.25%. This month inflation hit 9.6% which represents a 40-year high.

It is anticipated that there will be over 9,000 property transactions this year, this is the second highest number of sales since 2012 – with the highest number of sales recorded before the pandemic struck in 2019.

House prices in May went up by 1% in May – the equivalent of £2,300. The monthly increase in April was 0.6% by comparison.

Regionally, all but one of the local authority areas across Scotland saw the average house price rise over the last year – the only exception was West Dunbartonshire where prices fell by 0.1% to £144,901. The highest rise was in Argyll and Bute where prices went up by 22.6% to £227,213.

Across the country in May, 31 of the 32 local authority areas in Scotland saw average house prices rise over the last twelve months – the one exception is West Dunbartonshire, where prices fell by 0.1% to £144,801.

The area with the highest annual increase in average house prices in May 2022 was Argyll and Bute, where values jumped by 22.6% to £227,213 over the last year, followed by Clackmannanshire and East Ayrshire where prices rose by 16.5% to £153,147. In Edinburgh, prices went up by 8.1% to an average £341,488.

The rise we have seen in interest rates since December 2021 along with the cost-of-living crisis and record inflation has not yet impacted the housing market. The average price paid for a house in Scotland in May 2022 according to the House Price Index is a record price for the country.

Here at Clyde, we believe that the reason prices are rising against a backdrop of a rise in the cost of living and rising borrowing costs, is the issue of property supply and demand, especially as people return to our cities following the pandemic. In addition, investing in property remains an attractive proposition as it outperforms other assets.