Scotland’s annual price growth slowed with prices at the end of October standing 3.5% higher than a year before, against 4.4% the month before, Your Move’s House Price Index has found.
Scotland still remains the second highest of Britain’s regions in terms of house price growth behind the South West of England.
House prices in Scotland dipped marginally in October, falling 0.2%, with the average property value dropping £276.
Christine Campbell, Your Move managing director in Scotland, said: “Despite a slowdown in annual growth, both the strength and consistency of the Scottish market continue to be impressive.
“With demand strong and property still affordable, Scotland looks like it will finish 2017 in good shape.”
Annual growth in Scotland is well above the average for England and Wales as a whole in October, which stood at just 1.3%, and only the South West of England has grown faster (up 4.3% annually).
At £175,722 the average price in Scotland is almost £6,000 higher than a year ago.
Alan Penman, business development manager for Walker Fraser Steele, one of Scotland’s oldest firms of chartered surveyors and part of the LSL group of companies, added: “So far Scotland’s shrugged off the malaise that’s affected many other UK regions.
“With unemployment edging up and the rate of growth slowing, though, the impact of the provisions in December’s draft budget will be critical in determining whether that continues.”
The resilience of the housing market in Scotland continues to rest on strong demand and tight supply.
The market is fuelled by historically low interest rates, a relatively strong economy and affordable property, with median full-time earnings that are the third highest in the UK (at £547.30 a week or £28,460 a year) and a median house price (of £135,000) that’s the lowest.
Scotland’s “affordability ratio” is therefore 4.7 – the lowest of the UK. The equivalent figure for England is 7.8.
When it comes to supply, October’s Royal Institution of Chartered Surveyors Residential Market Survey identifies Scotland as having the fourth-lowest number of new vendor instructions in the UK.
Both Scotland’s affordability ratio and annual price growth benefit from a capital city market that continues to be strong.
Annual growth in Edinburgh, at 3.4%, is close to the national trend, in contrast to the price falls seen in London that pull the average down for England and Wales.