In its Quarterly Scottish House Price Index, the lender found that prices in Lochgelly in Fife had risen above the £100,000 bracket for the first time in Q1 2007, to £104,738.
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Overall, prices in Scotland rose by 7.50 per cent in the first quarter, with the average purchaser now paying £138,655.
Tim Crawford, group economist for Bank of Scotland, commented: “Along with Lochgelly, both Clydebank and Greenock broke the £100,000 barrier over the last 12
months. House prices in Scotland are the most affordable in the UK, despite an annual rise of 22.4 per cent. Also, because of this large increase in prices over the past year, the gap between prices in Scotland and London has narrowed to 2.1 times, down from 3 times in Q1 2003.”
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Bank of Scotland also warned the Scottish market was starting to see the impact of interest rate rises, with annual growth forecasts down to 7 per cent over the next 12 months.
Stephen Brown, senior technical manager at MoneyQuest, commented: “We are still seeing the continued marginalisation of first-time buyers in the Scottish housing market but there are lots of innovative products out there that aim to help them. However, I think the lower inflation forecasts are right as higher interest rates will slow the market, but it will also make mortgage products less competitive.”
