The strength of a local property market is usually gauged on how far and how fast prices rise in a particular location. However, the rate at which houses sell, in terms of speed, can often be just as important.
In which case vendors in Scotland’s two major cities are doing just fine, according to a survey by internet search company, Zoopla. Research by Zoopla showed that properties in Edinburgh are the fastest-selling in Britain, taking just 22 days, with Glasgow not far behind at 27 days. This compares with 47 days for Britain as a whole and is far superior to London, Manchester, Bristol and Cardiff, which come in at 54, 36, 34 and 32 days, respectively.
Whenever reading surveys of this type, I am always aware of the comment by the author, Mark Twain, about there being “lies, damned lies and statistics”. However, in principle I would not dispute the veracity of these results with the caveat that the Edinburgh property market, like the city itself, is a patchwork quilt and how fast a house or flat sells will depend on condition and location.
As an aside, it is also worth noting that one reason properties sell so much quicker in Edinburgh and Glasgow than in English and Welsh cities is because the buying and selling process in Scotland means “chains”, a problem south of the Border, are virtually unknown. On occasion a sale will be concluded much quicker than usual because speed is of essence to the vendor who is prepared to be flexible on price, yet there is no evidence that these type of sales are more common in Edinburgh or Glasgow than in cities down south.
In Edinburgh, some of the best New Town flats and townhouses manage to secure a buyer, literally, within 48 hours of coming on to the market – and, in some instances, without any publicity whatsoever – while properties in what might be called “emerging locations” can take substantially longer than the 22 days mentioned in the survey.
Within these two extremes, in what could be described as “in-between locations”, properties do seem to be selling quickly. These are established neighbourhoods – such as, Blackhall, Colinton and Corstorphine – which, in addition to a wide variety of family-type housing, offer much in terms of convenience shopping, schools, GP, dental surgeries and other local services. With Edinburgh’s economy growing, there is an excess of demand over supply relating to these and similar locations which helps to facilitate speed of sales.
Having said that, to achieve a quick sale without complications, vendors need to take an objective view on price, no matter the desirability of the property or location. An investor might, on occasion, pay quite a bit above market value because a particular property offers a unique opportunity for higher-than-average capital growth but the conventional buyer, as owner-occupier, tends to stick to a limit which he or she has set before starting the viewing process.
Even in the most sought-after locations, sales can go wrong because vendors had unrealistic hopes on price and level of demand. On occasion a speedy offer from a potential buyer (say within 24 hours of viewing) gives a false sense of security; in other words even though the sum the buyer is prepared to pay seems reasonable enough, the vendor takes this to mean there are many other people out there waiting to pay even more. Unfortunately, the opposite can also happen; interest from other potential buyers dries up – and the original offer (which the vendor now wishes they had accepted) is no longer on the table.
Therefore, speedy offers should not automatically be regarded as indicating wider viewer interest. If that offer is, say, 10 per cent above the upset price, acceptance could be preferable to wishing and hoping (without any guarantee) for a few percentage points more – especially when the terms of the offer fit perfectly with the seller’s own schedule for packing up and moving to a new property.
- David Alexander, MD of DJ Alexander