According to the latest research from Savills, confidence in the Scottish estate market is continuing to build in 2017 following the most active market in a decade last year.
The market for estates in 2016 saw a total of 26 estate sales at a combined total asking price of £90m: this included some significant and notable deals.
We believe terms have been agreed on seven estates so far this year, amounting to 37,000 acres and an accumulated asking price of around £45m, including three sporting estates. We are seeing overseas interest being spurred on by favourable interest rates following the Brexit vote, as Scottish estates stand out as exceptionally good value.
This interest is complemented by an upturn in interest from English buyers (in 2016, 62 per cent of buyers were from the UK), who no longer have the debate surrounding Scottish Independence at the forefront of their decision-making process.
Despite the levels of wealth being invested in Scottish estate properties, there is a growing appetite for properties that can pay for themselves. This is often through diversified income streams, such as surplus sporting, forestry, renewables, leisure and tourism opportunities. We are also finding that many buyers want to concentrate on salmon or grouse, rather than both. This was borne out by the sale of the Suisgill Estate in Sutherland.
Originally marketed as a whole, those interested in the fishing were deterred by the significant value of the stalking and vice versa. Once we split the estate into two lots, interest levels increased – albeit that it did in fact sell as a whole to one buyer, retaining the integrity of the estate.
Today, many buyers of sporting estates have not actively been looking but recognise an opportunity when they see one. This has had an effect on the way estates are marketed, as historically many at the upper end were sold privately.
Setting the right price is essential; demonstrating value for money can generate competition. Quite often buyers who aren’t interested when an estate is offered privately become keen when it is publicly marketed. Two-thirds of the deals struck for sporting estates so far this year have been agreed on a private basis.