These teams will do all your househunting and research, and even give you access to the private property market
For most, the act of searching property portals — or estate agency windows if you’re old-school — can turn into a frustrating waste of time and energy. For the well-heeled, however, it doesn’t need to be this way.
Enlisting the skills of a buying agent — a specialist who will find you a home, advise you on market conditions and help negotiate your bid — is commonplace in London and is catching on fast in Scotland.
While many estate agents offer a buying service to clients with whom they have built up a long-term relationship, only one has launched a bespoke department dedicated to the art of house-hunting.
“We felt there was an opportunity to be on the side of buyers,” says Anna Henderson, the head of CKD Galbraith’s premium property buying team.
“Buyers do not have the hours in the day to be constantly scanning for what is available. What is privately available and what is about to come to market are also areas in which we can help.”
Scotland’s independent property buyers, many of whom have been established for more than a decade, are finding that new clients are approaching them for different reasons.
“Initially high-net-worth individuals came to us because they were time-poor. Also, the likes of Rightmove did not exist and there was not an awful lot online,” says Matthew Sinclair, the director of the Edinburgh-based buying agency Saint Property. “Increasingly we are being called in on a consultancy basis.”
While searching is still a large part of the services provided by buying agencies, the focus has switched to advice.
Volatile market conditions over the past two years, including changes to taxation legislation and the independence referendum, have left purchasers unsure about when, where or what to buy. In the cities, particularly Edinburgh, competition for properties is at its fiercest since the pre-crash years.
With a buying agency, those concerns are eliminated. For the right fee, it is possible to hire an adviser and have potential properties presented to you on a plate, with up-to-date research and market analysis included.
We explore exactly what the process entails.
What they do
In short, a buying agency will offer three key services — search, acquisition and consultancy.
A specialist will scour the market for properties a client might like based on pre-agreed requirements, timescale and, of course, budget. Suitable houses are fed back to the client ad hoc, which might be a regular occurrence for a city-centre house brief and less frequent for a large estate.
Once a buyer has identified a property they wish to bid for, a buying agency will encourage them to view it, then should they wish to advance negotiations an agent will visit the house to assess it.
“We would highlight benefits, potential problems, what the neighbours are like and give them an opinion on the asking price — whether it is high, low or reasonable,” Henderson says.
“If they decide they like it, we would go and have a look at it and produce a comprehensive report on the pitfalls, positives and price.
“There are other details that we would find out. For example, if a property has a bridge that can only bear seven tonnes but you need to get a 45-tonne timber lorry over it, we would highlight that. We also flag not what the current buyer should consider, but the buyer after that.”
If a client decides to purchase a property, an agency will use its knowledge of the Scottish market to guide them on price. Using specialist information gleaned from several sources, including the Registers of Scotland, a decision can be made on the correct time to bid.
Experts will also use this data to forecast the property market in order to help prospective clients marry this insight with their own purchasing ideas.
What they do not do
Agencies will not take on two clients who have similar briefs. Agencies say it is not in anyone’s best interests to have two purchasers seeking an eight-bedroom Georgian townhouse in Berwick-upon-Tweed. In these cases, being turned down by an agency really isn’t personal.
Who uses them?
Well-off buyers, but also those in the middle and even lower end of the market if the buying conditions are right. It varies between agencies, but an “investment” (property bought in cash) costing £500,000 can often secure you the skills of a specialist, especially if future business is promised.
Generally, time-poor purchasers with a budget of £1 million and above are the target audience. In this price bracket, the saving a buying agency can make may run into six-figure sums.
Wealthy clients who are not based in Scotland will simply not risk missing out on an estate they have their heart set on, according to experts. About 90 per cent of Saint Property’s clients are “non-doms” based in Europe, the Middle East or Russia.
“People who are a step or two removed from Scotland are unsure about what is happening here,” Sinclair says. “They need reassurance about what impact the market will have on their purchase.
“They are also very aware of what is on the market — and how long it has been on for. They need support and back-up in coming to their opinion of what to buy, and quite often someone to deal with the negotiations.”
In particular, buyers of estates and farms will look to a buying agency because of the amount of off-market movement. While it varies from year to year, in 2012, 58 per cent of estates were sold in Scotland without gracing websites such as Rightmove or Zoopla.
Agents reveal that a buyer with a budget of about £3 million could be given access to between 10 and 15 off-market estates.
Farms form a big part of the private market because many sales are agreed upon as a result of two neighbouring properties expanding their land. Armed with a little black book of Scotland’s agricultural figures, an agency can gain access to who is planning to sell what.
“There are about 40 agencies in Scotland selling farms and estates,” says Henderson. “For many buyers it is exhausting trying to work out who to target and where to start.”
What are the benefits?
There are two main plus points — in-depth market analysis and access to what is viewed by many as the holy grail of property circles, the private market.
The best buying agencies will keep a log of every property that has come on to the open market. From there, asking prices can be compared against selling prices, as well as the time spent seeking a buyer, to give a house-hunter all the information needed to get the best possible price.
Most agencies will also use specialist data from Registers of Scotland, that will reveal how many off-market sales have occurred in the past decade. This is the area in which buying agencies’ knowledge can really come into its own.
Off-market sales do not only comprise properties in which the seller will only consider a private deal, but houses that are almost ready to be listed. Given this exclusive access, canny buyers are able to sneak in early.
“That particular seller might then favour doing an off-market deal because they find it too traumatic to have their home on the open market, and too exhausting to hold umpteen viewings,” says Henderson. “Some of the bigger estates will have a period of time before they are put on the open market where they invite private offers. It can be a number of years, months, or just weeks.”
And the drawbacks?
While its mystery is appealing, the private market can have financial pitfalls.
“More often than not, when things are brought to us off-market there is a caveat that states a premium has to be paid,” says Sinclair. “The other side will say: ‘We are giving you exclusivity and you have to pay to stop it going to market.’ ”
That charge comes on top of what a buying agency will command. Specialists will either work on a fixed fee, which could range from £5,000 to £50,000 depending on the property and the amount of work they have to do, or a percentage — usually up to 2 per cent — of the overall sale price.