Scottish housing market is in remarkably good health

The latest official statistics show that average house prices in Scotland rose by £10,654 in twelve months. Between June 2024 and May 2025 average house prices in Scotland increased from £181,273 to £191,927. This is an annual increase of 5.9 per cent compared to a rise of 3.1 per cent in England and Wales over the same period.

This is quite remarkable and reflects a consistent prolonged period of growth. Between June 2020 and May 2025 average prices in Scotland rose by 27.9 per cent, which is a very high level of sustained growth in the Scottish market. To put this in perspective the average prices in England and Wales rose by 23.1 per cent over the same period. This means that for half a decade Scottish house prices have been rising at a faster rate than our neighbours across the border.

But the figures for the last year show that there is not uniform growth across the country. In Scotland there were substantial variations in price rises, with East Lothian recording the highest increase of £27,946; Midlothian rising by £19,700; Perth and Kinross up £18,938; Edinburgh increasing by £18,691; and East Dunbartonshire up by £17,962.

There were two areas which recorded a fall in average prices, with Aberdeenshire falling £5,690 and South Ayrshire dropping by £3,376. The next three lowest increases were in Aberdeen which rose by £625; West Dunbartonshire increased by £1,055; while Moray was up £3,161.

There were 12 areas which recorded an average price above £10,000. The most expensive place to buy a home in Scotland is East Lothian with an average price of £297,042, while the cheapest area is Inverclyde at £113,679.

This gap of £183,363 between the most expensive area to buy and the cheapest is concerning and could indicate a growing divergence between some more affluent areas and the rest of Scotland.

A clear price gap is developing around the capital and its surrounding areas with East Lothian, Edinburgh, and Midlothian the first, second and fourth most expensive areas to buy in Scotland. East Renfrewshire and East Dunbartonshire occupy the third and fifth places indicating a similar situation emerging around Glasgow.

Continued uncertainty over the future of the North Sea oil and gas sector is causing a drag on prices in Aberdeenshire which had a £5,690 decline in average prices and a marginal increase of £625 in Aberdeen city itself.

North, East and South Ayrshire alongside West Dunbartonshire are all in the bottom ten performing areas, indicating a considerable slowing of the market in these areas.

Obviously, prices fluctuate and the average price growth over the last five years has been up and down although the trajectory is broadly upwards.

This means that the Scottish housing market remains in remarkably good health. Whether this continues remains to be seen because this level of annual growth is quite unusual historically. Lower mortgage rates later this year and the recent easing of lending criteria will help but there are a number of downward pressures including employment uncertainty due to rising employer National Insurance costs, and further tax rises anticipated in the Autumn Budget. However, for the moment, these figures show a remarkable resilience on the part of Scottish homebuyers.