House prices top £200k for first time ever

THE cost of the average home in Scotland has soared to more than £200,000 for the first time in history.

House prices increased by almost £50 a day in the year to June amid ‘exceptional’ growth, according to an index from Halifax.

A typical home now costs £201,549, which represents an increase of more than £18,000 on the same time last year.

Meanwhile, annual house price inflation in Scotland rose to 9.9 per cent in June, from 8.5 per cent in May.

Graham Blair, mortgages director at Bank of Scotland, said: ‘Scotland recorded exceptionally strong house price growth during June, with the cost of a typical property rising by almost £3,000.

‘While such rises are often welcomed by existing homeowners, anyone looking to move still faces the challenge of buying into a sellers’ market, while the difficulties facing first-time buyers also become more acute. However, when compared to many other parts of the UK, Scotland continues to provide some of the most affordable locations in which to buy property.’

Across the UK, the average house price hit another record high of £294,845.

UK house price inflation also grew for the 12th consecutive month, and the annual growth rate of 13 per cent is the highest since late 2004.

Iain McKenzie, chief executive officer of the Guild of Property Professionals, said: ‘Despite all the economic and political turmoil in the UK, prices continue to climb and we’re seeing the highest annual growth rate in 18 years. It will surely be only a month or two before we see the price of the average UK property break through the £300,000 barrier for the first time.’

Business development director at e.surv Chartered Surveyors, Richard Sexton, also expects more growth.

He said: ‘Homeowners, for now, are managing to cope with the impact of inflation. Indeed, arrears figures remain at historic lows. Housing, as an asset group, continues to outperform other classes and, as ever, a lack of supply of desirable stock continues to support price growth.’

But David Alexander, director of property firm DJ Alexander, sounded a note of caution.

He said: ‘There should be alarm bells ringing as this situation is clearly not sustainable.

‘Everybody likes the value of their home to increase but it is happening at such a meteoric rate that I would question whether we may be on the brink of a sharp fall in prices.’