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House prices in Scotland fall by £8 a day

There was another blow for the housing market in Scotland when figures released showed average prices had dropped by almost £3,000 over the last 12 months.

Despite an average increase of £5,000 throughout the United Kingdom, homeowners north of the border saw their property value fall by £8 per day. South Lanarkshire was one of the worst areas, with a £5,641 drop in average values. This is according to figures released from a leading property information website. Falling prices are another worry for landlords with landlord insurance who are not looking forward to the changes in housing benefit coming next year.

Nicholas Leeming, commercial director of the website, said “Scotland’s property boom outlasted much of the rest of the country, but the recovery has been stronger and more rapid across the border in England, driven by London and the south east.

“Areas least dependent on public sector jobs will perform best in the year to come. Most important of all to providing firm foundations for the market, however, will be if lenders stop restricting the supply of mortgages. There is demand to move – lenders must allow us the loans to do so.”

And there was more bad news after a survey of Scottish surveyors showed prices will slip even more this winter. The RICS (Royal Institution of Chartered Surveyors) said a fifth more members had reported prices falling rather than rising in November.

However, RICS said the decline of house prices in Scotland was in fact slower than in some other parts of the United Kingdom, with Northern Ireland and the West Midlands seeing worse price values. Expectations for prices in the first quarter of 2011 are not very hopeful and sales are also predicted to fall.

Sarah Speirs, spokeswoman for RICS in Scotland, said “Despite some better economic data, fears over how future spending cuts will impact on the jobs market are clearly still weighing heavily on potential purchasers’ minds, with many deciding to “wait and see” until the new year.”

By Simon Dack

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