First-time buyers drive up prices says LSL Property Services/Acadata First-time house buyers, buoyed by growing confidence and an improving economy, have helped drive up prices and sales in a "revitalised" property market, according to a report. The average house price in Scotland hit £144,253 in September, up £952 (0.7%) on the previous month, the report finds. It also represents an increase of £647 (0.5%), compared with September last year, and marks the first time in 32 months that the annual rate of change has been in positive figures. Sales levels are also at their highest for five years. Experts said a "phenomenal rise" in first-time buyer activity helped power the surge with growing confidence among banks and a "buzzing" mortgage market contributing to the increase in activity at the lower end of the market. But they caution that the property market still has a long way to go to recover and is climbing from a low starting point. The September figures appear in the latest LSL Property Services/Acadata house price index which shows that the volume of sales in the third quarter of the year is 22% higher than in the same three months of 2012. Acadata chairman Dr Peter Williams said: "Earlier in the year we suggested that we would have to wait a few months before we could see whether the nascent recovery would be sustained. All the evidence shows it has been, and that it will continue. The market has clear evidence of forward momentum which is easing some of the difficulties that had built up for homeowners needing to move but where prices had settled too low to make that an easy choice. Our expectation is that transaction numbers for the remainder of the year and beyond will continue to be above the levels set in 2012. This, in turn, will lead to further rises in house prices as a shortage of properties coming to the market will be apparent in several locations. According to the survey, the average price increase of £647 over the year marks the first time that the annual rate of change has been positive since January 2011. Elsewhere in the UK in September, house prices increased in all regions of England and Wales for the first time since October 2010. Dr Williams said: "The main reason for the return to positive price movements in the housing market is the increase in activity seen during the year. The main driver of this increase has been the first-time buyer. The mortgage companies eased their constraints on lending to this sector of the market, offering more competitively priced products with lower deposit requirements. This, together with renewed consumer confidence and alongside a general economic recovery, has supported the improvement. This is reflected too in the transaction figures. But he cautioned: "Some may deduce from this that a general housing market bubble is around the corner. However, we have to remember that this recovery is from a low base of activity where prices, at least in some localities, are down by 25% from 2007 levels. The headlines may thus give a misleading picture of where the market is, and of the pressures building up. Thus while we can be optimistic for 2014, we should not imagine the market recovery is going to look like a runaway train. It won't. Regional figures show that house prices in Aberdeen grew 10.6% over the year, taking the average cost of buying a house in the city to a new record high of £194,932. But this is the only local authority area with record prices, with most other areas seeing discounts of between 5% and 25% on their previous peaks. Donald MacLellan, chairman of Walker Fraser Steele Chartered Surveyors, part of LSL, said the Scottish housing market is being "revitalised." He said: "The main driver of this increase is down to the phenomenal rise in first-time buyer activity at the lower end of the market. Lenders have eased conditions, banks are more confident and generally the mortgage market is buzzing. First-time buyers have witnessed a plethora of top mortgage deals, greater product choice, and low interest rates are giving people more confidence to buy. The Government's launch of its own version of the Help to Buy equity loan scheme has given the market a real helping hand. Before we get swept away with the positive news, it is important to stress that the Scottish property market has a long way to go.