Property prices in the countryside are, on average, £27,047 (17%) higher than in urban areas, according to the latest annual Bank of Scotland Rural Housing Review.

According to the review, there is a rural premium in all regions, with countryside homes typically commanding a significant price premium over urban areas, although there are large variations across Great Britain.

Despite the higher price for buying in the countryside, the gap with urban prices is apparently narrowing and property prices have risen more slowly in rural areas during the past five years.

Between 2010 and 2015, the average price of a home in the Scottish countryside rose by 13% compared with an average increase of 15% in urban areas. In the past year the average price of a home in the countryside has risen by 5%, marginally lower than the 6% increase in urban areas.

The most affordable rural local area district (LAD) in Scotland is East Ayrshire, with an average house price of £115,394, which is 3.8 times the local average annual earnings of £30,299. Dumfries and Galloway is the second most affordable rural LAD in Scotland, with an average house price of £128,245, 4.5 times the average earnings of £28,691. Argyll and Bute is Scotland’s third most affordable, where average house prices are £153,508, 5.1 times the annual earnings of £30,065.

The least affordable rural LADs in Scotland are Aberdeenshire (6.4 times) and East Lothian (6.2 times).

First-time buyers account for 43% of all mortgage financed purchases in Scottish rural areas. This is lower than in urban areas where first time buyers account for half (50%) of such purchases. Affordability difficulties are the key factors behind the lower level of first-time buyers in rural areas.  

Getting on the rural property ladder is at its most challenging for first-time buyers in the Scottish Borders, where they only account for 38% of buyers in that area. East Lothian, Argyll and Bute, Aberdeenshire and Perth and Kinross also sit below the Scotland average.

Properties in the rural areas of Scotland are typically a third larger than in towns and cities. The average rural home is 130m2 in size compared with 100m2 in urban areas.

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