Kirsty McLuckie on figuring out great property value

Researching and writing about property over the years has probably given me a better understanding of the process than the average person, but few can accurately predict the vagaries of the housing market.
Image: AdobeStockImage: AdobeStock
Image: AdobeStock

Recommending the best use of others’ money is never a good idea, and the more specific the questions, the more I will duck a definite answer. I can’t advise on future rises and falls, when and where to buy and the biggy – how much to offer. That way lies broken friendships and rancorous relatives.

And if I could nose out the ultimate prize of a perfect property at a knock-down price, I’d have done it myself by now.

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Even people who get paid to do deals like this can find expectations of some of their clients a bit high.

When I interviewed Kirstie Allsop and Phil Spencer recently, they said that the bane of their lives were buyers appearing on their Location, Location, Location show insisting on their full checklist of requirements and an absolute line-in-the-sand budget, only to turn their noses up the properties sourced by Phil. The pair wearily related that often the buyers would then buy a different property, having “found” an extra £100,000, or lowered their minimum expectations.

The inference being that they only took part in filming because they thought the presence of Kirstie and Phil would conjure up good deal.

But, all that said, I am open to discussing property decisions with friends, and this month I’ve been chatting to one who is considering a downsize out of Edinburgh.

She is not from these shores, and only has one experience of buying property in Scotland, her current home in the Capital, some 20 years ago, which explains her misunderstanding of the current situation.

Trying to be helpful, I sent a couple of links to likely properties in the Borders within her price range, along with a news snippet, stating that the market in the region is doing well, with prices paid in some villages averaging about 105 per cent of the Home Report.

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It wasn’t just her poor maths which led to the panic attack. After some very confused exchanges, it became clear that she thought that winning bids would be an extra 105 per cent over the value, not plus five per cent.

In her defence, she bought her Edinburgh property in 2002. It was priced at offers over £98,000, and she ended up paying almost double.

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The introduction of Home Reports in 2008 is much grumbled about, but having a clear indication of what a professional assessor thinks a property is worth has – in the main – put paid to such wild, stab-in-the-dark bidding.

The competitive closed bidding system used in Scotland will always throw up headline figures on properties that are unique, very sought-after and, crucially, the type of properties that are bought by people with deep pockets of cash.

For buyers utilising a mortgage and bidding for an average house, Home Reports are the best indicator of what the selling price will be, give or take a few percentage points.

Moreover, most sales outside the Capital don’t go to a closing date, only about a third of properties in the Borders do so, for instance.

My advice to nervous bidders? Keep calm and buy by negotiation.

- Kirsty McLuckie is property editor at The Scotsman

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