Experts hit the roof as new survey suggests 10% rise in house prices

THERE was some cheer for homeowners today as new figures suggested prices have risen ten per cent in Edinburgh in the last year.

The claim from Lloyds TSB showed that the average house price for the year to July 2011 was £229,720, the biggest rise in Scotland.

However, the news of a price hike was quickly questioned by other experts, who insisted they had seen prices dipping.

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Business analyst for the Edinburgh Solicitors Property Centre (ESPC) David Marshall, said he thought figures which showed a 1.1 per cent drop over the quarter were a more accurate reflection of the Capital’s housing market.

The most recent figures from ESPC showed that the average house price for the three months to June was £219,530 – down 3.6 per cent annually.

Mr Marshall said: “The most likely case is that their market share may be slightly lower and it’s based on a relatively small sample, because I don’t think anyone is suggesting prices are ten per cent higher than they were a year ago.

“I think the figure that prices are down 1.1 per cent is closer to what we’re seeing. Recently, in general prices are about three to five per cent lower in most areas than they were at this time last year.”

Mr Marshall said he thought prices in the Capital would remain lower than last year for several months to come. “The general consensus, and this is certainly what we’ve seen, is that prices are lower than they were at this stage last year.

“I think prices are going to be around five per cent lower than they were at this time last year for the next few months, they will level out towards the end of the year.”

The price boost reported by the Lloyds Scottish House Price Monitor in Edinburgh was the largest in any region of Scotland. Aberdeen saw a 9.4 per cent annual rise, with Dundee up 5.4 per cent.

The report said that across Scotland, house prices were almost identical to four and a half years ago.

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Chief economist Donald MacRae said: “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.

“Consumer confidence remains low due to high levels of retail price inflation in excess of increases in earnings squeezing disposable income. The Scottish housing market did experience the normal effect of spring this year on sales and purchases but the impact was muted. The number of transactions increased from the depressed levels of winter but remained below the levels of one year ago.

“The Scottish housing market awaits a resurgence of both business and consumer confidence for a faster recovery.”

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