In a new series of blogs, OnTheMarket.com finds out what is going on in a corner of the property market. In the second installment, estate agent Simon Brown of CKD Galbraith reveals what is happening in Scotland.
There is little doubt that the independence referendum dominated the agenda in Scotland last year and it’s inevitable that such events have an impact on the property market, in much the same way as the upcoming general election will too. In our experience however, 2014 was a year of steady growth in the Scottish property market and our statistics from the first quarter of 2015 suggest that this trend is set to continue with our sales up 24% compared to the same period of last year. Our offices across Scotland are generally reporting rising levels of buyer confidence and activity as we enter the traditional spring selling season.
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We’ve recently seen an increased demand for high quality city property. In particular our Edinburgh Estate Agency team have enjoyed a buoyant first quarter of 2015 with increased competition from buyers for city apartments and town houses with properties selling on average more quickly compared to the first quarter of 2014. As demand begins to outweigh supply in Scotland’s capital, we expect considerable interest in properties such as 18B Gamekeeper’s Road, a very attractive six bedroom villa in a prestigious address to the north west of Edinburgh city centre.
18B Gamekeeper’s Road
A recent major change in Scotland is that taxation of property purchases has now been devolved from Westminster to the Scottish Parliament. In these changes which took effect on 1 April, Stamp Duty in Scotland has been replaced with a new tax called Land and Buildings Transaction Tax, or LBTT for short. On a practical level, LBTT operates in a similar way to the revised system of stamp duty introduced to the rest of the UK at the end of 2014. The bands however and the rates levied on the portion of the sale falling within these bands are different.
While property purchases at above £125,000 are eligible for stamp duty in England, LBTT does not apply in Scotland until the £145,000 mark. This means that you could move into properties such as this top floor Aberdeen flat or this traditional fisherman’s cottage in Moray without having to pay tax on the transaction.
Our message to buyers in the rest of the UK is simple: don’t be put off by the different taxation and legal systems! We have always seen a high-number of buyers from outside Scotland and the sales teams in any of our offices are more than happy to guide you through the process.
Thriepley Estate
Scotland certainly has an enduring appeal and you can often get more for your money than South of the Border. For example Thriepley Estate and Kinpurnie Castle both offer much more space than you could ever expect from a London flat at the same price.
Kinpurnie Castle
We have previously predicted that the LBTT changes will lead to an increase in interest in “commuter belt” properties and in more rural homes with good access to the cities. The new Waverley Rail Link scheduled to open in September 2015 should also be beneficial to the Borders’ property market. The 30 mile stretch of railway with seven stations will reduce journey times from the Borders and Midlothian into Edinburgh. Properties in the towns of Tweedbank, Galashiels and Stow are expected to benefit such as this terraced home which is just around the corner from the terminal and so will more rural properties such as the Victorian country house Cathpair House and the modern Thornylee Farmhouse with its spectacular views over the Tweed Valley.
Thornylee farm
While we haven’t seen a significant increase in Scottish house prices, the Scottish market remains highly price sensitive. My advice to homeowners in Scotland thinking about selling is that accurate and realistic pricing is key to attract interest in a competitive market place.
Simon Brown is Head of Estate Agency and Farm Sales for CKD Galbraith which has offices across Scotland.
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