Scottish property proving robust

Tuesday, 29 April 2008 12:00 AM

Scottish property is proving to be the most robust in the UK amid the present market turbulence, according to new research from Knight Frank.

According to the estate agent, the region recorded price growth of 13 per cent during 2007, ahead of any other area of the UK.

However, this was accompanied by a 16 per cent fall in sales volumes, in line with the rest of the UK.

With mortgage lending restricted borrowers are struggling to find affordable deals and deposits and interest rates rise.

"Scotland's housing market is proving remarkably robust in the face of the turbulent market conditions affecting the wider UK market," said Liam Bailey, head of residential research at Knight Frank.

"Against this background our assessment is that house price inflation in Scotland will average one per cent in 2008 and will outperform all other UK regions."

Prices are widely expected to fall across the UK over the course of the year, with analysts Global Insight predicting prices could fall by as much as seven per cent by the end of the year, with a further drop of nine per cent in 2009.

However, sections of the Scottish property market are likely to remain immune.

"Mid and lower-priced properties in the £140,000-£180,000 range are likely to perform well, as young professionals and investors compete for affordable properties coming on to the market," explained Mr Bailey.

Recent figures from the Department for Communities and Local Government (CLG) support the Knight Frank findings, showing prices north of the border were up 9.7 per cent year-on-year in February.

This compares to 6.7 per cent across the UK as a whole, and just 3.7 per cent in Northern Ireland.

Chris O'Toole

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