An ONS (Office for National Statistics) report that house prices in the UK have reached an all time high – exceeding their previous peak in 2008 – attracted lots of coverage yesterday. You can find the ONS report here .
It was heartening to see that much of the Scottish media noted that, although prices across the UK have risen over the last 12 months (up by 3.8%), they had actually fallen in Scotland over the same period, by 0.7%.
In fact, house prices in Scotland are still some way below their peak and house price inflation in Scotland has been lower than the rest of the UK for some time. This graph neatly illustrates the point.
Annual house price inflation (selling prices now compared to the same month a year ago) in Scotland has been above zero in just five months since the start of 2011. In comparison, house price inflation in London has been in positive territory throughout that period while prices in the South East have been above zero since April 2012.
Given recent improvements in sales, I suspect that house prices in Scotland have pretty much fallen as far as they are likely to go. But don’t let UK news of a recovery in house prices give you a false impression that house prices north of the border are on their way up.