Yes vote could lead to fall in Scottish house prices ...

A Yes victory in today’s Scottish referendum could slash house prices north of the border, property portal Zoopla claims.

According to Zoopla, Scottish house prices over the last two years have grown on average by 8.3%, with the average value now standing at £177,599.

However, if the economic impact of independence is as stark as has been recently suggested, a market shock like the one seen during the recent financial crisis (when house prices in Scotland fell by 17.5%) could potentially come about if a Yes vote materialises.

Assuming the same thing happened, it would wipe over £31,000 off the value of the average Scottish home and £85 billion off the value of the total housing stock in Scotland.

With several large businesses and employers in Scotland threatening to move south of the border if a Yes vote happens, and uncertainties regarding currency, tax and interest rates if Scotland breaks away, Zoopla predicts that all this would impact negatively on house prices north of the border.

Additionally, with a more limited pool of lenders, mortgages could become harder to obtain and higher interest rates could come into play. As well as this, homeowners could be earning wages in a new currency but remain stuck with a sterling-based mortgage. This could leave people open to currency fluctuations, meaning they struggle to pay their mortgage and end up in negative equity.

According to property search company The Buying Agents, the uncertainty of the upcoming referendum has seen several foreign investors deliberately delaying their purchases as they wait to see how the outcome of the vote affects them. Japan’s largest bank, Nomura, recently claimed that sterling would drop by 15% in the event of a ‘YES’ vote, and overseas buyers are currently erring on the side of caution.

“There is an awful lot riding on Thursday, with serious consequences for homebuyers and investors alike,” Henry Sherwood, Managing Director of the Buying Agents, said. “It will be interesting to see how the vote swings and no doubt we shall be holding our breath in anticipation”.