The average price paid for a house in Scotland in March 2022 was £218,992, setting yet another record price for the country, marking the seventh occasion that this has happened in the last twelve months.

This price is some £12,700 higher than that seen in March 2021, meaning that prices have risen by 6.2% on an annual basis. This increase is 1.6% lower than the revised 7.8% seen in February 2022, and is in fact the lowest annual rate recorded since November 2020 – some 16 months earlier.

On a monthly basis, prices in March 2022 rose by 0.5%, or close to £1,120. Again, this monthly increase is lower than the revised 1.2% recorded in February, but surpasses the 0.1% that was seen in December 2021, three months earlier.

The housing market growth rates would therefore appear to be slowing in March, although, house prices are continuing to climb, with the slowdown in rates being almost imperceptible.

It should also be borne in mind that house prices in March 2021 had an upward blip, being one month ahead of the termination of the LBTT tax holiday in Scotland on 1st April 2021.

The ending of the tax holiday in April 2021 prompted an increase in the number of transactions that took place in March 2021, as well as an increase in the number of high-value properties sold in the month.

This followed as buyers brought forward their actual purchases into March 2021 - or even earlier - to take advantage of the tax savings available. It can therefore be concluded that the cause of the slowdown in annual rates in March 2022 is due to the higher-than-normal values that were current in March 2021, distorting the annual comparison.

Looking at the England and Wales housing markets, Walker Fraser Steele found that all regions showed an average increase of +2.3% in house price growth in March 2022, compared to Scotland’s fall of -1.6%. However, also relevant is the fact that the ending of the equivalent LBTT stamp duty tax holiday in Wales didn’t occur until June 2021, whilst in England the tax holiday continued up to the end of September 2021.

England and Wales did not therefore experience the same upward movement in prices in March 2021, as was seen in Scotland, and hence comparisons in March 2022 across the three countries can be misleading.

Scott Jack, regional development director at Walker Fraser Steele, commented: “Our data this month shows Scottish house prices continue to edge upwards. Modestly positive increases across the board continue to be the trend.

“The average house price in Scotland has increased by some £12,700 - or 6.2% - over the last twelve months, to the end of March. The average price paid, £218,992, sets another record and is the seventh time that this has happened in the last twelve months. On a monthly basis, prices in March 2022 rose by 0.5%, or close to £1,120. This monthly increase is lower than the revised 1.2% recorded in February, but surpasses the 0.1% that was seen in December 2021, three months earlier.”

He added: “It appears that the lack of good stock coming onto the market continues to support prices. This is in the face of some significant cost-of-living challenges too. We cannot know what that means for future performance, but we do know that high inflation makes property an attractive asset for investors when other assets do not offer such great returns. While you might think the future is uncertain, regional markets will perform differently for very specific reasons (think Aberdeen and oil) driving national averages.

“In our data, 31 of the 32 local authority areas in Scotland saw their average prices rise over the previous twelve months, one more than in February. On a monthly basis, on the mainland, the largest increase in prices was in Argyll and Bute, where values rose across all property types except for flats.”