The 2017 estate market has proved to be fairly robust despite all the political uncertainty. Scotland remains one of the few areas in Europe where large areas of wild land can be acquired for either sport or conservation. These opportunities are highly valued by buyers from continental Europe in particular and estates continue to be readily traded on both the open market and privately, albeit in low numbers annually. Typically between 15 – 20 estates are sold each year, some of which may be purely residential in nature. There tends to only ever be one or perhaps two estates with driven grouse available in any given year, and maybe only 3 – 5 with quality red deer stalking. The average sale price and extent in 2016 was around £3.4 million and 4,500 acres.
It is too early to form an accurate judgement on the effect of ‘Brexit’, however, as long as there is not another financial crash, we anticipate that current market conditions are likely to persist for the foreseeable future. The low value of the pound has certainly been a boost to foreign buyers. The payment of high premiums, which was a feature of the market before 2008, is now less common but still possible for exceptional properties or in cases where there is a special purchaser. It is also the case that coastal/waterside properties tend to command a premium. Recent coastal estate sales have achieved premiums over asking price by as much as 35%. In 2016, premiums over asking price averaged 5% (ranging from 20% below to 40% above asking price).
The estate sales market in 2016 was more active than at any time in the previous decade, with 24 estates sold. More buyers, particularly foreigners, entered the market on the back of improved exchange rates. To date in 2017, there has been less for sale on the open market, but a number of estates available privately. Ongoing concerns over the Scottish Government’s land reform proposals, rumours of a second referendum on Scottish Independence, and Brexit, may have ‘thinned’ the market to an extent, but for every buyer lost it seems there are others who appear not to be so troubled by the prospect of any of these factors.
Anna Henderson heads the Premium Property Buying Team of Galbraith, based in their Edinburgh office at 59 George Street, Edinburgh EH2 2JG