THE number of homes sold in Scotland in the first five months of the year has risen by 11% compared to last year, showing signs of recovery in the housing market, according to a new report.

The average cost of a house in Scotland stood at £146,073 in May, down almost £200 on the previous month's figure.

Experts said the market was faring well under a "stuttering" economy, but issued a note of caution on mortgages, saying lending to buyers with small deposits has been suppressed.

The findings in the latest LSL/Acad Scotland house price index revealed that despite prices being flat, they are higher than at the beginning of 2012.

The study revealed the number of transactions carried out from January to May this year was up 11% on the same five months last year, although the figure was still significantly down on early 2007 levels.

Dr Peter Williams, chairman of Acadametrics, said: "Over the last year we have seen six months in which prices have fallen, five months in which they have risen and one month when prices remained static.

"On an annual basis prices are 0.6% lower than May 2011.

"Although house prices in Scotland as a whole show relatively little movement, we find that the change in price at the more local level can be far more dramatic."

Meanwhile, figures from the Office for National Statistics showed prices have risen in England and Wales over the last year but have fallen in Scotland and Northern Ireland.

The report said year-on-year prices fell by 1% in Scotland to an average of £177,000.