High end houses pushing £5m tag

Published on Saturday 7 June 2008 14:29

SCOTLAND is expected this year to break through the £5m barrier for the most expensive house sold, as the property market north of the border continues to hold up despite the global economic slowdown.

Estate agent Strutt & Parker has predicted the milestone will be reached in Edinburgh this year, based on the record number of million-pound-plus homes it has sold in recent months and the properties about to come on the market.

The highest residential house sale in Scotland to date was the 5m obtained for Seton Castle in East Lothian last year, but the highest price yet for an Edinburgh property is 4.95m.

Strutt & Parker said it sold 15 homes for more than 1m across Scotland in the first quarter of this year, up from nine over the same period in 2007.

Its country house department is averaging a sale price of 19.1% above the asking price, compared with 18% last year. It is not just Strutt & Parker that says the top end of the market remains buoyant. Total sales of properties over a million pounds increased throughout Scotland by 138% last year.

Blair Stewart, head of Strutt & Parker's Edinburgh residential department, said: "We have four properties coming on the market at offers over 3m in the next few months. That's double the number we had last year.

"A 5m sale is within reach in the city of Edinburgh this year. There are opportunities for people to buy a grand house in Edinburgh and refurbish it to increase the value."

This month the estate agent is to start marketing Langham House, a 10,000 square foot mansion and the former headquarters of housebuilding company Applecross, on Grange Loan at offers over 3.35m.

Stewart added there is strong demand for such prime properties from southern buyers and wealthy Edinburgh residents who are looking to trade up. The most expensive areas of the city where a 5m-plus sale is likely to occur include The Grange, Barnton and Murrayfield.

Despite the increase in house prices, Scotland is still much more affordable than London. The premium price per square foot for a top-end residential property in London is 4,600, compared with 640 in Edinburgh. Strutt & Parker currently has a property on the market at Cheval Place in Knightsbridge for 45m.

Reports from private banks and solicitors provide further evidence that the top-end Scottish housing market remains buoyant.

Graham Keith, senior solicitor in the property team at HBJ Gateley Wareing, said: "The global credit crunch has not really affected the type of client who is buying property over the million-pound mark.

"In almost all cases such clients will be financing a large proportion of the price from personal funds rather than a mortgage. These clients are likely to have funds available from other sources such as the sale of a business or investment properties, or indeed cash in the bank."

HSBC Private Bank in Scotland said it has not seen any slowdown in the demand for mortgages or loans for more than 1m.