Scottish island house prices soar

House prices in Scotland’s island regions have seen a remarkable surge, outpacing those on the mainland in recent years. According to a fresh report from Registers of Scotland, there has been a substantial 30% increase since 2018, bringing the median price to £182,000.
Comparatively, house prices on the mainland have risen by 23%, with the median price now standing at £185,000.
Despite the overall island median remaining slightly below the Scottish average, there are significant variations between regions. Prices range from £135,000 in Shetland Outer Islands to £249,000 in the Highland Islands.
An interesting trend highlighted in the report is the higher proportion of cash sales in the islands (57%) compared to the mainland (37%). This variance suggests a different buyer demographic and potentially less reliance on mortgage finance. Cash sales range from 39% in Shetland Mainland to 75% in Arran, Bute, and the Cumbraes.
Scottish island regions map (credit: National Records of Scotland)
The report also delves into specific property types. In remote small towns, 15% of sales were in the island regions, with a median price matching the mainland at £150,000. However, in remote rural areas, where 22% of sales were on islands, the median island price of £195,000 was lower than the mainland’s £220,000.
Paul McLennan, the housing minister, emphasised the importance of good quality housing in attracting and retaining people in island communities. He pointed out that since April 2016, the Scottish Government has supported the delivery of over 1,100 affordable homes on islands across Scotland. The commitment to deliver 110,000 affordable homes by 2032, with at least 10% allocated to rural and island communities, is backed by the Rural and Islands Housing Action Plan.
McLennan further highlighted the Rural Affordable Homes for Key Workers Fund and Rural and Islands Housing Fund as essential components of the government’s strategy to address specific housing issues in rural and island areas. Additionally, secondary legislation has been implemented to empower local authorities to make decisions regarding the council tax treatment of second homes, aiming to ensure a balance in the use of housing to meet local needs.
Registers of Scotland’s keeper, Jennifer Henderson, praised the report for providing valuable insights into property prices across the Scottish island regions. She reiterated the commitment of Registers of Scotland to furnish innovative and accessible land and property data that is beneficial to the people, businesses, and policymakers of Scotland.