House prices in Scotland have increased by 0.3% month-on-month in May, as the average price for a property reached a third consecutive record of £225,636, Walker Fraser Steele has found.

The chartered surveyor’s house price index also revealed that house prices increased by 2.5% annually.

Walker Fraser Steele added that Scotland is currently enjoying its "strongest market conditions in two years".

Regional development manager at Walker Fraser Steele, Scott Jack, said: "Scotland’s residential property market gives us further cause for optimism this month as average home prices increased in May for the third month in a row. The market has remained remarkably resilient in recent years given the challenges it has faced but this month’s gain of nearly £600 (0.3%), represents the strongest performance for two years. This is a hat trick of record new house prices over the past three months.

"Our data shows that Scotland’s average house price is now well in excess of £225,000 and comfortably above its earlier peak in September 2023. Clearly, Scotland is enjoying an earlier and stronger revival than across most of England and Wales."

Annually, West Dunbartonshire (12%), Clackmannanshire (8.1%) and East Ayrshire (7.8%) all saw the largest increases in house prices in May, with 15 local authorities seeing increases month-on-month.

East Lothian (6%), Scottish Border (4.4%) and Orkney Islands (3.9%) were the worst performers annually, with 16 regions seeing drops in prices month-on-month.

Furthermore, the chartered surveyors added that sales activity continues to nudge higher in May.

Jack added: "The net balance was noticeably less positive than in March and April, in line with the more measured overall price gains seen across the country.

"Despite this, there were still three local authorities – Highland, Renfrewshire and East Ayrshire - where prices hit new market highs. Meanwhile, Dumfries and Galloway and Glasgow have shown the most consistent recovery story, having increased for five straight months in a row.

"At a local authority level, the market saw increases in 15 areas, and, with the onset of a new government, we expect market sentiment will further improve. The new government has already said it is supportive of the existing mortgage guarantee scheme which has been used to good effect in Scotland. Confidence will likely be further buoyed as the Bank of England begins to cut its base rate in the coming months."

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