Homes in some areas are still selling well in Scotland

Rises in interest rates and increases in the cost of borrowing are being blamed for the gradual slowdown in the property market.

In the three months to July 2007, property prices in Glasgow and Aberdeen fell by 1.2% and 1.4% respectively, compared with the previous quarter.

The figures were contained in the latest quarterly housing report published by Lloyds TSB Scotland.

There was a 10% fall in prices in the south east (excluding Edinburgh) and a 2.5% drop in the south west (excluding Glasgow).

Despite the statistics, the report said the value of properties was still increasing in parts of the country, with no significant fall predicted.

Although there is wide variation in price changes in Scotland, there is clear evidence that the Scottish house price boom is coming to an end Professor Donald MacRae Lloyds TSB Scotland

Dundee had a strong quarter, with a 9.2% rise.

The cost of properties in the north of Scotland also increased (13.1%) as did those in Edinburgh (2.8%) and the Central/Fife/Perth/Tayside region (10.1%).

Professor Donald MacRae, chief economist with Lloyds TSB Scotland, said: "We witnessed a significant surge in house prices in the previous quarter, which goes some way to explaining the range of quarterly results in the current quarter.

"Although there is wide variation in price changes in Scotland, there is clear evidence that the Scottish house price boom is coming to an end.

"Recent interest rate rises and increases in the cost of borrowing are clearly having an effect."

Lloyds TSB also released Scotland's annual property price increases.

AVERAGE HOUSE PRICES Aberdeen - �200,141 Edinburgh - �228,087 Glasgow - �160,834 Dundee - �150,806 Central - �150,254 Fife - �150,254 Perth - �150,254 Tayside - �150,254

The largest yearly rise was in Aberdeen where the value of property increased by 32% between July 2006 and July 2007.

The average property in the Granite City now costs �200,141. In the capital, prices increased by 15%.

Edinburgh remains the most expensive city in Scotland to live, with the average property now costing �228,087.

In Glasgow, people pay about �160,834 for their home - a 5% rise compared with 2006. Property costs in Dundee rose by 16% with householders paying about �150,806.

And people living in the Central/Fife/Perth/Tayside area pay an average �150,254. This is a rise of 12% since July 2006.

Prof MacRae added: "The rate of increase of house prices in Scotland has slowed significantly but a fall in house prices remains unlikely.