Slowdown in house price decline

Two people look in an estate agent's window

House prices are continuing to fall, but at a slower rate

Scottish house prices have continued to fall but the rate of decline has slowed, according to research by Lloyds TSB.

The bank's Scottish House Price Monitor showed the average domestic property dropped in value by 2.3% in the three months to 31 January.

The previous figures published in November showed a 4% fall - the largest in the 16-year history of the monitor.

On an annual basis house prices have risen by 1.6%.

Lloyds TSB said the average mix adjusted Scottish house price was now £158,820.

The number of house sales was down by almost a half on the levels recorded for the same period last year, with a 48% fall.

Property values in the east saw slight rises in the last quarter but this came after greater falls in the three previous months.

See the figures in full

In the west prices, which had been continuing to rise albeit slowly, have now fallen.

A spokesman for the bank said: "The picture across the country is very mixed with areas reporting the greatest quarterly fall still recording an annual increase."

Professor Donald MacRae, chief economist, Lloyds TSB Scotland, added: "The Scottish housing market has responded to the economic slowdown with a reduction in transactions and in some cases price falls.

"The cost of borrowing has reduced for many mortgage holders with the latest fall in interest rates in early February.

"The Scottish housing market is adjusting to changing circumstances with reduced sales and in some cases lower prices rather than a precipitous collapse."

Scottish house prices

AREA	Underlying annual rise	Quarterly change
Glasgow	+3.4%	-7.3%
South East (excluding Edinburgh)	+3.0%	+3.2%
North (excluding Aberdeen)	+6.1%	+3.7%
South West (excluding Glasgow)	+3.4%	-7.3%
Central/Fife/Perth/Tayside (excl Dundee)	+0.5%	-11.8%
Edinburgh	0.0%	+7.3%
Aberdeen	-5.2%	+4.1%
Dundee	-8.4%	+8.0%
Source: Lloyds TSB