Rising by 13.1 per cent during 2007, Scottish house price growth continued to outpace the rest of the UK, with the region recording the UK's only double digit increase.
However market conditions and the introduction of HIPs definitely rocked the boat in the latter half of 2007, with last year becoming the second year since 2001 where prices rose by less than the long-term average of 8 per cent.
All UK regions recorded a house price increase, with Northern Ireland experiencing the second highest regional rise behind Scotland.
Indeed, Northern Ireland was the most expensive region in the UK outside London and the South East at the end of 2007.
Scotland and the North were the only regions to record higher house price increases in 2007 than in 2006. Whilst the smallest house price rises were seen in East Midlands at 0.6 per cent.
Halifax has stressed that the 0.8 per cent price slump in Quarter 4 2007 needed to be seen in the context of the substantial rise over the past few years - prices in the capital, for example, have risen by 193 per cent over the past ten years.
Going forward
Halifax expects worsening affordability and weakening economies to cause a modest fall in prices in northern England and the midlands, however 'sound economic fundamentals and lower interest rates' would act to support house prices according to the firm's chief economist, Martin Ellis.
"House prices for the UK as a whole are predicted to be flat during 2008, but there are likely to be regional variations. Small price rises are expected in the south and Scotland whilst modest falls are predicted in northern England and the midlands. These falls should, however, be viewed in the context of the substantial house price rises over the past few years.
"The UK economy is expected to deliver its 65th successive quarter of GDP growth during the year, extending the longest running period of unbroken growth on record. The MPC is likely to follow up last month's cut by reducing the Bank Rate at least twice in 2008."
