Scottish house prices continue to show a strong upward trend, according to the latest Lloyds TSB Scotland House Price Monitor.

Average house prices in Scotland have increased for the 18th successive quarter, although the rate of growth has continued to slow, according to the figures released today.

Prices in Dundee are rising the fastest in Scotland, with a 20% increase recorded in the last three months and an annual rise of 27%.

Having reached a standstill earlier in the year, Edinburgh house prices have now resumed modest growth with a quarterly rise of 6.2%. However, the capital city does post the lowest annual rise at 13%, having entered first into the house price boom.

Edinburgh still has the highest average house price at £167,357, followed by Glasgow at £142,945, Aberdeen at £129,058 and Dundee at £121,133.

"Overall, price increases are less than they were," said Professor Donald MacRae, chief economist at Lloyds TSB Scotland, "but the Scottish slowdown is much less severe than it is in the south of England."

"Edinburgh was probably the first into the housing boom and Dundee is probably the last, so it's all about the timing and they will catch up to an extent," he added.

The area surrounding Dundee posts the next most significant growth, with Perth, Fife and Central showing an annual rise of 23%, despite a fall in prices of 2.1% in the last three months.

Aberdeen and Glasgow posted quarterly falls of 3.1% and 2.6% respectively, though their annual growth rates are still high at 17 and 23%.

Professor Donald MacRae, said, "House buyers will be further encouraged by the recent cut in interest rates while the demand for houses continues to exceed supply. However, house prices cannot continue rising indefinitely at a rate faster than the increase in earnings, although a slowdown in the rate of price increase seems unlikely this year."