Scottish house prices drop by 3.7%


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According to Lloyds TSB, Scottish house prices have dropped by 3.7% over the last three months.

The average Scottish house price was reported within the bank's house price monitor reported at £152,565, almost the same level as early 2007.

Lloyds TSB on Scottish house prices

Chief Economist Donald MacRae for Lloyds TSB Scotland commented: "The Scottish housing market has adjusted to the recession with a halving of sales and a period of volatile price movement over the last three-and-a-half years.

"Average house prices in Scotland are now only marginally up on the levels of four-and-a-half years ago."

Scottish House Prices sump confirmed by S1homes and ESPC

A recent collection of price data from s1homes and new research from the Edinburgh Solicitors Property Centre (ESPC) seems to support the views offered by Lloyds TSB with the ESPC reporting that almost two thirds of properties within the East of Scotland have sold for less than the Home Report valuation. The number of people looking to sell also continues to outstrip the number of active buyers meaning the balance of power in negotiations remains firmly with the buyers.

ESPC comment on Scottish houses prices

David Marshall, business analyst with ESPC said: “About 15% of sellers are choosing to market their home below valuation when it first goes on the market which reflects the level of competition in the market. Additionally, when it comes time to negotiate on price the balance of power clearly favours the buyer.

"In the majority of cases the difference between the selling price and the valuation is relatively small – typically under 5% - which indicates that both buyers and sellers have a level of confidence in the valuation. 

RICS on house prices and the problems getting a mortgage

Graeme Hartley, director of The Royal Institution of Chartered Surveyors went on to say: "It is no surprise that many properties, especially at the lower end of the market are selling for an average 5% less than the Home Report valuation. Some potential buyers are still having problems getting a mortgage and raising a deposit. Those with finance will want a 'bargain' and may not be prepared to pay the full valuation. Sellers need to be realistic about the price they can achieve for their property. The valuation in a Home Report should be seen as a guide to what a property may achieve: for some it will be higher, for others it will be lower."

Positive news on Scottish house prices

On a positive note, it has been report by the RICS that the Scottish housing market did experience the normal spring effect on sales and purchases however, to a much lesser degree than previous years. Mr MacRae of the RICS added: "The Scottish housing market awaits a resurgence of both business and consumer confidence for a faster recovery."