Orkney house prices see highest rise in Scotland since pandemic

STV News

2 days ago

Orkney house prices face highest rise in Scotland since the pandemic skyrocketing by over 60%
The average price of a house in Orkney has risen by over 60% in the last five years – the steepest rise of any council area in Scotland.
According to figures from the UK House Price Index, Orkney's house prices have outpaced the Scottish average nearly three times.
The rise seen in Orkney is quite a bit higher than the council areas with the next highest rises: Midlothian at 48% and City of Glasgow at 38%.
According to analysis from the Office of National Statistics, Orkney's house prices dipped during the first year of the pandemic.
But when the rises began, they were significant.
In April, May, June and July 2021, property prices rose by over 30% each month.
A wave of similarly steep hikes was seen in April, May, June and July 2022 as house prices rose by more than 20% in each of those months.
The first reductions in house prices since December 2020 came in April 2023 and continued month-on-month until January 2024.
However, these reductions were all under 11%, with prices only reducing by more than 10% twice during that period.
Prices began to rise again in April last year, although at a far more modest rate that before.
They steadily increased up to a peak of 14.3% rise in January this year.
That escalation curbed slightly with a further 11.7% rise in February and 11.8% in March.
So where does this leave Orkney house prices since the beginning of lockdown up to this year?
At the beginning of lockdown, March 2020, the average house price in Orkney was £131,476.
As of March this year, five years later, the provisional average house price as of March 2025 was £215,580. This is a 63.9% rise.
Drawing a comparison with the average house prices in Scotland over the same time period, in March 2020 the average house price was £151,856.
In March 2025, it was £186,000. That's a rise of 22.4%
What about Orkney's islands cousins? Over the same five year period, Shetland saw a 26.1% rise in prices – not far off the Scottish average.
Meanwhile, the Na h-Eileanan Siar council area saw a 36.2% rise.
While Orkney may have seen the highest percentage rise, it doesn't have the highest average house price.
That title belongs to East Renfrewshire, with an average house price of £295,545.
Shetland also has a higher average price than Orkney despite it's more modest rise, at £229,663.
It's worth bearing in mind that any statistics that come from Orkney can show wild swings.
This is because it produces a lower data set than other larger areas.
In this case, a small number of very expensive homes being sold could heavily affect Orkney's average house price.
However, long term trends provide a more reliable picture.
News of high house prices, while unpleasant, will come as no shock to many Orcadians trying to buy.
Karen Allan is the founder and owner of K Allan Properties, a local estate agent.
She began selling houses just before lockdown got under way. Before that she and her husband had been developing properties for years.
As such, she has developed a good understanding of the local market over the last 20 years.
'Orkney has a strong market.
'A lot of stock is circulating between all the agents on the island consistently all year round.
'Pre-pandemic was a lot cheaper, there is no two ways about that.
'The prices have shot up to an unbelievable level.'
Asked why this is, she said: 'During Covid, our rural lifestyle was extremely desirable.
'This resulted in properties selling at inflated prices.
'This naturally led to inflation on market data and home report valuations rose substantially as a result.
'Prices went a bit too high, and we started to see properties reduce across to the island.
'Stock took a bit longer to sell at certain stages, especially when the mortgage rates went very high.
'There was no choice but to stabilise this with a sensible starting point when going to market.'
Asked about the effect this has all had on local buyers she said it has been a tough pill to swallow for them.
'It took a long time, but I feel the locals have sadly had no option but to accept the prices and the offers over price tags.
'I feel harsh saying this. It wasn't accepted easily in the beginning of the housing boom.
'It was hard at first as we were in an unprecedented market after lockdown.
'Locals were sadly being deflated with multiple rejections. It really was a harsh time for them.
Despite this, she said she is continues to advise people on how to make a move.
'It's not impossible and my 19-year-old son making it onto the property ladder recently is testament to that.
'Ultimately, financial planning is key to achieving this and the bigger a deposit you have, the better chance you'll have of making it happen.'
Get all the latest news from around the country Follow STV News
Scan the QR code on your mobile device for all the latest news from around the country