Lloyds TSB: Scottish house prices suffer greatest quarterly drop since records began

Date:Friday 14th November 2008
Author: Rachel Fletcher

Scottish house prices have taken the biggest quarterly fall in 16 years, figures from Lloyds TSB have shown.

The quarterly price index for the average domestic property recorded a four per cent fall in the three months to October 31st, bringing the average mix adjusted house price to £165,398.

It is the largest quarterly fall since the House Price Monitor began.

The number of house purchase transactions in the Scottish house price monitor has decreased by 43 per cent on the same period in 2007.

Professor Donald MacRae, chief economist for Lloyds TSB Scotland, said the country's economy was entering "a significant slowdown".

He observed that the number of mortgage products available has dropped, as has the cost of borrowing for many mortgage holders after the cut in interest rates earlier this month.

Meanwhile, Yolande Barnes of property firm Savills has predicted in the Times that house prices will rise again before going through another drop.

She expects prices to have fallen by 25 per cent from their peak by the end of 2009 and to be about two-thirds of the way to that figure by the end of 2008.