Growth rate falls, but Scots house prices continuing to rise
From The Herald
September 18, 2008
Growth rate falls, but Scots house prices continuing to rise
Scotland continues to buck the UK trend of falling house prices but the pace of increase has slowed considerably, falling to just 3.6% for the year to the end of July - well down on an annual rate of 9.7% recorded in January.
Across the UK, annual house price growth fell for the ninth month in a row during July to hit a record low, according to government figures.
The Department of Communities and Local Government said the average UK property had lost 0.3% of its value during the year to the end of July, the first time it has recorded an annual fall since the index began in 2003.
However, despite the fall on an annual measure, the index also recorded a 1% jump in house prices during the month itself. Annual house price growth is now negative in all regions of the UK except Scotland, the north-west, east and south-east, while growth in London has stalled, leaving average prices unchanged during the year. Meanwhile, a new study suggests young people reliant on their parents for financial support are increasingly using the "bank of mum and dad" to access credit. The price comparison website moneysupermarket.com has found that 23% of twentysomethings have used their parents as a guarantor when applying for a loan. Tim Moss, head of loans at moneysupermarket.com, said: "Not only can your offspring eat you out of house and home, they're increasingly leaning on parents financially too. It has been common for mum and dad to be tapped for some financial help towards a first home, but more and more parents are being asked to act as guarantors on a range of credit applications, including loans and mortgages. "The tightening of lending criteria across the board has meant it's becoming difficult to even get a credit card or a loan, never mind access the most competitive rate on a mortgage. "Younger people are especially vulnerable in this climate - they tend not to own a home and are more likely to have missed the odd payment on a mobile phone or credit card. "While this may not seem like a big deal at the time, it can have a dramatic impact on your credit record. In today's stormy financial climate, the more credit- worthy you are, the better your chances of being accepted for the best deal." Marion Kernachan, a 23-year-old student in her fourth year studying English and creative writing at Strathclyde University, is one person who has had to turn to a parent for financial assistance. "I live at home with my mum, Avril, and my twin brother, John, so I don't really have any bills to pay," she said. "My mum is on incapacity benefit and she pays the bills for the house. "My only income is my student loan and my bursary but that isn't enough for uni so my mum pays the extra that I need. It's difficult at the moment because my bursary hasn't come through yet, so I'm relying on my mum for everything. During term time it's quite difficult as well but I've learned to adapt my spending to what I can afford."
