Now average house price hits £203k

AVERAGE house prices in Scotland hit a record high last month despite falls across the rest of the UK.

The average property price in Scotland was £203,677, although there was a slight slowdown in annual growth – up by only 9.6 per cent compared with 9.9 per cent the previous month.

In June, the average house price was £201,549.

This was in contrast to the UK as a whole, where the average price slipped back in July from a peak in June, marking the first month-onmonth dip for 13 months.

House prices fell by 0.1 per cent month-on-month in July, Halifax said. This represented a £365 fall in cash terms. A typical UK property now costs £293,221.

Russell Galley, managing director of Halifax, said: ‘It’s important to note that house prices remain more than £30,000 higher than this time last year.

‘While we shouldn’t read too much into any single month, especially as the fall is only fractional, a slowdown in annual house price growth has been expected for some time.

‘Looking ahead, house prices are likely to come under more pressure as market tailwinds fade and headwinds of rising interest rates and increased living costs take hold.’

Nicky Stevenson, managing director of estate agent group Fine & Country, said: ‘Cheap debt is fast disappearing and, against this backdrop, we can expect to see a dampening effect as purchasing power continues to be eroded.

‘While the housing market and broader economy do not always move in tandem, the recession predicted by the Bank of England is bound to have an effect on growth and consumer confidence.’

Alice Haine, personal finance analyst at Bestinvest, said: ‘Once a recession digs in, then the threat of job losses will raise its ugly head – damaging buyer confidence.

‘The real turning point could be the Bank of England’s decision to hike interest rates to 1.75 per cent.’

The Bank of England raised the base rate by 0.50 percentage points on Thursday, marking the biggest single jump since 1995.

This will add around £50 per month to average tracker mortgage costs, said trade association UK Finance.