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Housing market review
21/06/2007
A a report that provides a comprehensive summary of the housing market in Scotland, including an analysis of the recent house price boom, its causes and consequences, was published today.
The Scottish Housing Market Review 2007, which includes previously unreleased data, says that recent rapid growth in house prices has made getting a foot on the ladder increasingly difficult for many first-time buyers.
Some key findings:
- Problems are particularly acute in some rural areas, and in Edinburgh and the Lothians where up to 30 per cent of working households are unable to afford the cheapest properties available
- High prices constrain people's tenure choices, reducing Scotland's economic competitiveness, limiting workforce mobility and skewing wealth towards the top end of the housing market
- First time buyers are having to fund bigger deposits to secure a mortgage and are increasingly dependent on parental support
- Improving how housing supply responds to market conditions and building more new homes in market hotspots is the most effective way to sustain improved affordability and dampen down the big price increases seen since 2000
- Despite recent and forecast rises, interest rates are expected to remain at historically low levels over the medium term, indicating that higher house prices and larger mortgages are likely to remain a feature of the Scottish housing market
Minister for Communities and Sport Stewart Maxwell said:
"The Scottish Government is aware of the difficulty many people now face in accessing affordable housing - and easing that burden is a top priority.
"These findings make it very clear that we must increase housing supply in Scotland. We must, however, do this in a sustainable way. This will be a major challenge, not just for the government, but for local authorities, housing providers and the construction industry.
"The report will help to inform the future direction of government policy and help identify some of the key obstacles that we are determined to tackle, so that housing policy contributes to a wealthier and fairer Scotland."