House sales in Scotland have slumped by up to 50% in the past year as a result of the credit crunch, raising fears that the country could be facing the first annual property price fall in more than a decade.

Properties which sold within days last year, when mortgages of up to 120% were available, are staying on estate agents’ books for months as buyers struggle to raise finance.

In the first quarter of this year 20,289 Scottish properties were sold, down 18% from 24,813 homes in the same period last year, according to the online property guide myhouseprice.com. The year-on-year fall for April, May and June was 19%, with 24,245 properties sold compared with 30,067. A growing number of homes are only selling after being put on the market at a fixed price or following substantial price cuts. Last night the online guide said that a fall in the value of Scottish properties was “inevitable”.

The Edinburgh Solicitors Property Centre reported a drop in sales of almost 50% last month compared with July last year. Neil Harrison, its marketing manager, said: “People are choosing to wait for the price they want. “Prices are not plummeting in Edinburgh yet, but because in Scotland we can get contracts signed within a few weeks we are starting to get a chain where people might wait to sell before they buy, which will then stop other people from buying who are also waiting to sell first.”

Bill Cullens, chairman of Clyde Property, one of the largest estate agents in Glasgow, said his company expected 40% fewer property sales this year — 1,200 compared with 2,000 last year. Mark Hordern, of the Glasgow Solicitors Property Centre, estimated a downturn of between 25% and 30% in volume for Glasgow and the West of Scotland for last month.

The Scottish market has so far avoided the house price slump seen in England, where the volume of house sales has fallen 61% over the past year, but growth has slowed significantly and prices have fallen in areas including Renfrewshire, Glasgow, Highlands and Fife.

Figures release last week by the Council of Mortgage Lenders showed that home repossessions across the UK had reached their highest level in 12 years as a growing number families, hit by soaring food and fuel prices, struggle to meet their repayments.

Andrea Gibson, a spokeswoman for myhousprice.com, said the credit crunch could lead to a fall in house values of 10%. “The reason for the drop in the number of sales all across Scotland is that nobody can get a mortgage at the moment. Seven months ago there were 4,000 buy-to-let mortgage products available, and today there are under 1,000, and those have high lending criteria.

“If the lenders had the money to lend and would slacken their criteria for lending, then houses would sell. There are loads of people who want to buy, but can’t.

“It’s inevitable that we are going to see house prices falls in Scotland. I don’t think they are going to be devastating but we will see it.”

The Aberdeen Solicitors Property Centre (ASPC) recorded an 8% rise in the number of residential properties entering the market, while sales dropped by 17%. “It is impossible to escape the credit crunch unharmed but it looks like we are not going to be as badly affected. This is partly due to the relatively stable economy up here,” said John MacRae, of the ASPC.

The slowdown has left many families in despair. Elaine and Bill McKeown were convinced their four bedroom detached period home in Bishopbriggs, East Dunbartonshire, would sell within weeks when they put it on the market at offers over £325,000 last October so that they could move to a more rural setting with their two children. “It is the perfect family home. The house comes with a beautiful garden and is in a very popular area,” said Mrs McKeown. “But we had very few viewings, so in the end, we chose to go for a fixed price, and even that made absolutely no difference. In the whole month of May, we had one viewing.”

The family took the property off the market. “This is a great house, but in these market conditions, nothing is selling,” Mrs McKeown said.

Estate agents are calling for more help for first-time buyers to stimulate the market.

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