Fifteen per cent hike in Borders house prices ‘a statistical anomaly’

for sale house signs
for sale house signs

CAUTION has been urged over statistics, released this week, which reveal that house prices in the region rose by more than 15 per cent in the three months from April to June, writes Andrew Keddie.

Registers of Scotland, which records all land and property transactions for the Scottish Government, reveals that the average house price in the Borders local authority area over that period was £187,000, compared to £162,000 in the corresponding quarter of 2010.

This was the highest percentage increase in Scotland where the average price of a residential property rose by just 0.4 per cent to £153,000.

The Borders average also far exceeds that of neighbouring Dumfries and Galloway (down 1.6 per cent to £134,000) and closes the gap with East Lothian where average house prices fell by 4.5 per cent to £194,000. The largest percentage fall occurred in North Ayrshire which showed a drop of 9.5 per cent with an average price of £105,000.

The figures do, however, reveal a major fall in the volume of local sales. Indeed, just 306 houses were sold in the Borders in the three months – down a massive 20.7 per cent on the 386 sold from April to June in 2010.

Nationally in Scotland, sales fell by 10.8 per cent and the slump in the Borders was only exceeded in three of the 32 local authority areas – East Lothian (down 24 per cent), Highland (26 per cent) and Moray (26 per cent).

“The fall in sales in the Borders is much more reflective of the local housing market than the increase in average prices which I consider to be a statistical anomaly,” said James Denne, a partner of estate agent Knight Frank’s Borders office in Lauder.

“I can only assume the figures have been skewed by a higher than average number of farm sales and by erstwhile city dwellers being forced to downsize.

“The reality on the ground is that the vastly-reduced number of houses which are selling are doing so because they are realistically priced.

“Prices peaked early in 2008, but they have gone back to 2006 value levels and, frankly, I cannot see any prospect of this situation improving for at least three years.

“New-build estates have been particularly badly hit.”

The boss of a leading housebuilding company in the Borders, who preferred not be named, said he was “staggered” by the Register of Scotland house price statistics as they related to this region.

“If there was ever a case of lies, damned lies and statistics, this is it,” he told us. “There may be an element of city dwellers buying mid to upper-priced homes and there is certainly more interest from outwith the Borders than within.

“I can only imagine that the Borders housing market area is small in comparison to others in Scotland so data recorded here is more susceptible to statistical anomalies.”