Market frowns in Glasgow

PUBLISHED : Wednesday, 26 October, 2011, 12:00am
UPDATED : Wednesday, 26 October, 2011, 12:00am


In what at that time was a groundbreaking marketing initiative, the world was once told that 'Glasgow's Miles Better', complete with an endorsement from campaign mascot Mr Happy. But in the past few years, there hasn't been much housing happiness in the city.

The best that can be said about Scotland's second-biggest urban area is that pricing is erratic. There are bargains to be had, but only if vendors are pushing for a sale - and for many, that isn't the case.

Keeping with the idea that the Scottish people are a canny lot, it seems they are waiting this one out, with a leading website showing that across the pricing board, houses are taking the best part of a year to sell.

Even in the prime price bracket of GBP1 million (HK$12.4 million) and above, it is taking 236 days for the deals to close. Geoff Lockett, associate director of Scottish property firm Rettie & Co, says: 'We are selling on a client-by-client basis and so each one is different. But prices are mixed.

'I have heard that one castle in Ayrshire has been sold for a bargain price, but that's because it had to be sold. By the same measure, two other castles in prime locations are still on the market and the owners won't negotiate down on the price because they are prepared to wait,' he said.

Even within a dour Scottish picture, there are lighter patches. As Lockett says: 'Key coastal or rural locations are holding up better than average, especially if they are within commuting distance of Glasgow.'

For example, Rettie has the Rhu Lodge, a detached Victorian villa set along the coast and boasts glorious sea views, on its books.

The house is within easy driving distance of the city and Glasgow airport and by world market comparison is indeed a bargain, with offers of GBP1 million or more.

The agency is seeing growing interest from overseas buyers, but they tend to be people who were born in Scotland and are coming home or families who can trace their roots back to the area.

'Interestingly, we have seen a huge increase in buyers recently from Dubai,' Lockett says. 'They are looking to get out of there and want some security.'

Within Glasgow itself, the West End is holding up well in the sub-GBP500,000 bracket and agents say there are some desirable villages within reach of the city, where properties are snapped up almost as quickly as they are advertised.

One is Whitecraigs and another is Thorntonhall village, where Corum Estates has an architect-designed new home at a guide price of GBP1.55 million. Set over three floors, it has seven bedrooms, a home theatre, gym and state-of-art security.

'The property market in Glasgow continues to be somewhat challenging and unpredictable,' said Neil Jamieson, a partner from Corum.

'The market at the top end, particularly in excess of ?1 million, continues to be somewhat fragile, but there has never been a better time to make an acquisition at the top end of the market, as prices are at their most competitive,' he said.

Jamieson's property firm is mainly selling to locals, although there is some foreign interest, but from Asia 'only very, very occasionally'.

It is all a far cry from the heady days in the late 1980s when the area was also making headlines when the region rebranded itself as Silicon Glen, a nickname for the hi-tech sector of Scotland, spanning the investment triangle of Glasgow, Edinburgh and Dundee.

Like Silicon Valley in California, it seemed that Scotland was in a boom and nothing could stop the march of money and technology.

One analyst at the time told a regional newspaper: 'It means all the houses in Scotland will soon go for US$1 million and the traffic will be horrible.'

However, just as quickly as they had been mentioned, big names such as Motorola, Hyundai and Compaq either scaled back their investments, moved their operations to Eastern Europe or China or simply never arrived to Silcon Glen.

Scotland's electronics industry collapsed between 1998 and 2006. Output slumped by more than 70 per cent and as much as 40,000 jobs were lost over that period.

The economic climate never recovered, but the picture is not all gloomy. In the past few months, Glasgow has again gained worldwide notice with the opening of the GBP74-million Riverside Museum on the River Clyde.

City officials are hoping that the showcase building, designed by prize-winning architect Zaha Hadid and housing more than 3,000 exhibits, will attract tourists and, in turn, major businesses.