Prices soar in rush to buy homes before tax introduced

SCOTTISH house prices have risen by an average of £46 daily over the year as buyers rushed to avoid the new tax on purchasing a home, new figures show.

Prices in Scotland have shot up by around twice the rate of England and Wales in the past year with the average house price north of the Border rising by 10.3 per cent – from £180,892 from £163,932 year on year.

The Your Move/Acadata figures shows that the average price of a home in Scotland soared by 9.3 per cent in March ahead of the April introduction of the Land and Buildings Transaction Tax (LBTT), which replaced stamp duty in Scotland.

The report reveals that average house prices have fallen by 3.7 per cent since March’s £187,965 peak.

Christine Campbell, Your Move managing director in Scotland, said: “The sentiment from buyers in our branches is upbeat as the stability of the housing recovery shines through.

“There is no denying that the recent tax turbulence has affected property prices in the shorter term, with the latest monthly dip testament to further shockwaves of the LBTT, as the market continues to absorb the change.”

The house price rise hotspots in Scotland were in Clackmannanshire, where the typical home costs 25.5 per cent more over the year, followed by South Ayrshire (16.8 per cent), West Dunbartonshire (15.8 per cent), Edinburgh (15.7 per cent) and Glasgow (15.2 per cent).

Losing out was East Renfrewshire, which last year had Scotland’s highest average house prices, but dropped to fourth in the local authority area rankings, with a one per cent annual rise. Edinburgh tops the list of the most expensive average house prices in Scotland with the typical home now costing £266,281.

Ms Campbell said that since the new LBTT regime was enforced, there has been only one million-pound home sold in Scotland in two months, which is “reining back current measures of growth”.

John Boyle, of Rettie and Co, said: “Over the course of the year, I would expect the price to settle down further, perhaps growth of only five to six per cent by the year end.”

See Scotland’s Homes pull-out