Property shortage 'fuelling' Scottish house price rises

Scottish house prices continued to rise last month, driven by a fall in the number of homes available to buy.

The latest survey by the Royal Institution of Chartered Surveyors (Rics) also said the number of potential buyers had risen for the second month in a row.

They said activity in the market had recovered following the Brexit vote.

The survey also predicted rent rises for tenants over the next three months as demand outpaced supply.

A slowdown in the housing market in July had been put down to uncertainty over the EU referendum, held on 23 June.

However, surveyors found that this was no longer the case.

'Dire shortage'

Rics chief economist, Simon Rubinsohn, said the lack of housing supply in Scotland was replicated across the UK.

He said: "The dire shortage of available housing across the UK is continuing to push prices upwards, regardless of the uncertainty linked to the ongoing discussions surrounding Brexit."

House sales across Scotland rose, according to Rics, with 13% more chartered surveyors seeing a rise in activity.

Interest from prospective homebuyers also rose, with 14% more surveyors reporting an increase in interest.

Gavin Miller from surveyors Graham and Sibbald, said: "There is a lack of new properties coming on to the market.

"This has resulted in strong prices being achieved, with many of the more desirable properties selling at closing date."

According to the Edinburgh Solicitors Property Centre (ESPC), the number of homes sold in east central Scotland between August and October was down by 15% on last year.

The average selling price rose over the year by 5%, and by as much as 19% for flats in hot spots, including Merchiston, Marchmont, Currie and Balerno.

The conveyancing specialists agree with the surveyors on the national picture, that this is due to fewer houses going on the market.

The number of sales instructions was 9% down on the same period last year.

As one sign that the market is normalising, however, the proportion of ESPC properties advertised with an "offers over" price reached 82%, up from 69% in 2015.

With the financial crash eight years ago, that Scottish property sales convention was replaced by "offers around" asking prices.