Scotland business

Scottish house prices 'lifted by high-end sales'

Estate agent Image copyright Getty Images

Scottish property prices in February rose at their fastest rate since the 2007 housing boom as high-end buyers completed purchases to avoid new tax rates, according to a report.

Estate agents Your Move found the average house price rose 1.7% to a new record high of £169,742.

Prices rose 6% over the year - the strongest increase since August 2010.

Your Move said the rise was driven by high-end buyers trying to complete purchases under stamp duty rates.

Stamp duty was replaced by the new Land and Buildings Transaction Tax (LBTT) in April.

'Peak prices'

The Your Move/Acadata house price index for February found the Shetland Islands had the highest yearly rise in Scotland, with a 26.9% increase.

Aberdeenshire, Edinburgh City, Aberdeen City, East Lothian and Angus also experienced peak prices in February.

Edinburgh topped the table with an average house price of £248,791, the report found.

Fifteen properties priced at £1m or more were sold in Scotland in February, compared to six the previous month.

They included one on the outskirts of Edinburgh which sold for just under £3.7m, the most expensive house to be purchased in Scotland since July 2011.

'Tactical'

Your Move regional managing director Christine Campbell said: "Tactical tax considerations have helped foster price growth in the Scottish housing market and are likely to play a significant role in the months to come too.

"Now that the LBTT has come into force, we expect to see a temporary drop-off in the number of properties sold above £750,000, now liable for the top rate of tax - similar to the impact we're currently seeing in London among £2m properties - in light of December's stamp duty changes.

"Typically in the housing market cycle, we would expect home sales to ease back in February, in the aftermath of the costly Christmas period."

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