Scottish property market ‘robust’ as average prices hit record high

By Jacqueline Wake Young

July 27 2022, 11:45 am

The annual Scottish house price growth is now 8.4%, the highest rate for this year so far.

Moray, Highland and Aberdeenshire were among the 17 local authority areas in Scotland to experience record average house prices in May 2022.

This is according to the latest House Price Index from Walker Fraser Steele Chartered Surveyors.

The House Price Index figures showed that in May, 21 of Scotland’s 32 local authorities saw house prices rise.

Aberdeen

In Aberdeen City, prices edged up slightly, reversing the downward trend seen in previous months.

In May, the average price of a house in Aberdeen showed an annual increase of 1.1% to £191,768.

Orkney Islands

Meanwhile the Orkney Islands saw a 10% fall between April and May, but still showed an annual increase of 15% to £206,853.

Shetland Islands

At the same time Shetland prices climbed steadily, up 5.5% in a month to £188,739.

Na h-Eileanan Siar

In Na h-Eileanan Siar, prices showed a monthly drop of 0.9% but overall the average for the Western Isles was up 4% to £145,786 in May 2022 compared to May 2021.

The average price of a house in Scotland was £220,870 in May, according to the Walker Fraser Steele House Price Index.

Aberdeenshire

In Aberdeenshire the average house price in May was £238,661, up 2.1% on April and up 5.3% on the year.

Moray

Moray saw an annual increase of 9.8% and a monthly rise of 1.4% to £205,062.

Highland

In Highland the average house price was £225,233, up 0.1% on April and 4.7% on the previous year.

The annual Scottish house price growth is now 8.4%, the highest rate for 2022 with the average Scottish house price standing at £220,870.

This May saw the second-highest number of transactions for that month in the past 10 years while 17 local authorities reached peak prices, three more than in April.

In total, 21 of Scotland’s 32 local authorities had rising prices in May, the same as in April. The largest annual increase was 22.6%, in Argyle & Bute.

In May there were an estimated 9,092 transactions as the demand to move house was strong.

Scottish property market

Scott Jack, regional development director at Walker Fraser Steele, said: “One would never claim any market is bullet proof but on the current evidence Scotland’s property market remains at the very least in robust form.

“The rise in interest rates and the increase in the cost of living are not yet having a marked impact on house price growth.

“The average price paid for a house in Scotland in May 2022 according to our data is £220,870, establishing yet another record price for the country – the 11th occasion that this has happened in the past 12 months.

“This price is £17,100 higher than that seen in May 2021, meaning that prices have risen by 8.4% on an annual basis.

Aberdeenshire saw an annual increase in house prices of 5.3% to £238,661 in May.

“This annual growth rate is the highest recorded to date in 2022.

“The market transaction data too is robust, defying any expectations of a slow-down on this evidence.

“The provisional figure for May 2022 is 9,092 transactions, which is the second highest May figure of the past 10 years – the highest having taken place in 2019, being the year before the pandemic struck.

Strong demand

“Ultimately demand is strong, but the supply of desirable stock remains low. Property prices are therefore seemingly more resilient in the face of rising borrowing costs.

“Over and above homebuyers, property remains attractive to investors too as it continues to outperform other assets such as equities, which are affected more acutely by higher borrowing costs.”

John Tindale, Acadata senior housing analyst, added: “In general, the peak month for sales in Scotland is August, with an average 9,350 transactions, so we can anticipate reporting on a slow build in the number of properties being sold over the next three months.”