Leading from the top
City properties are spearheading the recovery in the high value market, says
When it comes to million-pound properties, the market has suffered along with every other price bracket over the past five years. There are signals that a return to confidence will be achieved more quickly in the upper echelons of the housing market, but it very much depends on location. So far, city properties are fairing well in the recovery.
There is no doubt that larger, more expensive properties have been slow to sell and haven’t yet recovered their pre-financial crisis values or volume of sales. During the last boom year, 2007, edinburgh was on a high, with more £1 million-plus houses sold in the city (144) than were sold in 2009 in the whole of Scotland (111). Just 43 homes were sold in edinburgh at over a £1m in 2009, but this year estate agents are reporting a rise in sales which appears to be growing in momentum.
Rettie and Co have reported sales in the price bracket for the f irst ten months of the year at twice the rate of the whole of 2012. James Whitson says: “We certainly have been through the bad times, but I put that down to people in edinburgh not having a lot of debt, so those who don’t have to sell sit tight. Between 2008 and 2011 that is what anyone canny was doing.”
he says that the change is coming because of a bit more confidence in the market and the lack of supply of larger homes leading to some respectable offers. “The dinner party chat is that there won’t be ten people trying to buy your house, but there may well be one or two and so people have more confidence to sell.”
As for buyers, he says that this year has seen the f irst recruitment of those working in the financial sector in edinburgh; people moving to the city to take up posts from elsewhere in the UK make up a proportion of £1m+ buyers, so that has made a difference. “There are also the ex-pat Scots who recognise that now is a good time to buy, even if they aren’t moving home straightaway. They can live in the Far east, for instance, and rent a property out for five years before returning.”
Rettie and Co’s figures, they believe, show clear evidence that the prime market is on the up in Scotland, but location is important. In edinburgh, Whitson says the prime areas likely to attract a seven-figure price tag are the detached Victorian homes in the eh9 and eh10 post codes, as well as classic new Town townhouses in sought after streets such as heriot Row and Ann Street.
edinburgh usually accounts for more than 40 per cent of all top-end transactions in Scotland, but sales are now growing fastest in and around Aberdeen.
David Geddie, property partner with Simpson and Marwick, says houses that will achieve £1m in the city are most likely to be in the heart of the West end – Cults, Bieldside or Milltimber – and will be detached, Victorian or edwardian, and, of course, granite. “In edinburgh you can pay over £1m for a semidetached or a conversion, but in Aberdeen you wouldn’t.”
he also says that new build properties can achieve high prices, too: “Developers such as CALA have sold brand new properties on the outskirts for over £1m and that is perhaps a market unique to Aberdeen.”
Top-end city properties are doing better than previous years in the Glasgow, too. There were no £1m house sales in registered in the West end of the city last year, but Rettie & Co report four such sales here in 2013 to date. Maitland Walker says that while properties in the north or south suburbs of Glasgow such as newton Mearns or Bearsden regularly achieve seven figures, in the city it is a very exclusive area that produces such prices.
“They are all within ten minutes walk from Byres Road, so Dowanhill, hyndland and Kelvinside. It is about accessibility to the West end and to the private schools here.”
he says to justify their price tag, the million-pound properties will be whole townhouses, in good condition, perhaps with a small garden and a parking space, but they will not have any of the value add-ons which can bump up the price; the swimming pools, cinemas or heated driveways found in the top-end properties in suburbs to the north or south such as newton Mearns, Whitecraigs or Bearsden.
The rise in sales of £1m properties in our cities marks a confidence in the market which does attract overseas buyers, but Simon Rettie says that most are still homegrown: “Typically, only around one in ten sales over £1m houses in Scotland go to an overseas buyer in any given year. Although far from a negligible market, the influence of overseas buyers on this particular housing market has been exaggerated.”