Scottish house prices could drop following a 'Yes' vote

Potential £30,000 fall in prices predicted

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House price website Zoopla has warned that a 'Yes' vote could mean a 'sharp fall' in house prices in Scotland.

According to its figures, house prices in Scotland have risen by 8.3 per cent ( or £13,728) on average, valuing the typical Scottish home at £177,599.

Its report says that if businesses relocate out of the country the supply of available properties could rise as employees follow suit, leading to what it describes a 'sharp fall' in house prices. However, it says that a 'No' vote would 'remove uncertainty from the market and likely allow the recovery to continue'.

It adds that mortgages could also be harder to find, thanks to a more limited choice of lenders and potentially higher interest rates.

"While the impact of the referendum on the Scottish and wider UK economy long-term is hard to predict and there are opposing views, a ‘Yes’ vote would almost certainly have a detrimental effect on Scottish house prices in the short to medium term," said Lawrence Hall of Zoopla .

"The uncertainties on employment, tax, currency, EU membership and interest rates will all play their part and if big business does head south with a ‘Yes’ vote Scotland will lose a significant piece of their service economy with nothing to replace it, leading to a greater supply and reduced demand for housing and a resultant drop in house prices."

He added that a 'Yes' vote could have a similar effect as the recent financial crisis when house prices in Scotland fell by 17.5 per cent. This would wipe around £31,000 off the value of the average Scottish home.

Earlier this month, estate agents Strutt & Parker suggested that currency and credit risk uncertainty could deter buyers from entering the market and lead to a 'significant effect' on house prices in Scotland. It added that a win for the 'Better Together' campaign would probably mean confidence returning to the market and a rise in sales.

Miles Shipside from Rightmove said that just the debate about independence could make buyers nervous about investing.

"Should the independence vote win the day, then there could be months of uncertainty with the forthcoming general election causing further disruption," he said. "From a buyer perspective when other homemovers are nervous it can be a good time to act, as harder bargains can be driven."

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