Wealthy foreign investors are watching the Scottish housing market closely in the wake of the Brexit decision, poised to snap up sporting and agricultural estates that are unique to the country.
“This is a market that is exclusive to Scotland and one that is aspirational for many would-be purchasers,” said Matthew Sinclair, director at Saint Property, a property search company. “With sterling weak, estates will become very attractive to the non-U.K. purchaser, and we have already seen evidence of this in the enquiries we have had in the run up and post Brexit vote.”
These estates, which in most cases have thousands of acres of land for hunting, shooting and fishing, as well as a grand house often with historical connections, have long been popular with wealthy investors, attracted by the privacy they offer. Many estates can also produce significant income in the form of renewable energy among other things.
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Notable estate owners include the wealthy Danish family behind Lego, who own two sprawling neighboring estates in Scotland, while Anders Holch Povlsen, the Danish billionaire fashion magnate, is now Scotland’s second biggest landowner.
“Scottish estates attract interest from around the world. Western Europeans from small countries such as Belgium, Denmark and Luxembourg, are often particularly attracted to Scotland due to the nature of the landscape and the size of properties available relative to their own countries while remaining relatively accessible," said Robert McCulloch, estates and farms sales specialist at Strutt & Parker. "Also, Americans and Australians with historic connections to Scotland are often keen to buy Scottish property."
However, the slide in sterling since after the Brexit vote has already made these trophy hunting, shooting and fishing estates cheaper, leading to an increase in inquiries from investors, who will no doubt be watching currency movement closely to see if there are further savings to be had.
At the same time, more properties are expected to come onto the market as the Scottish government is trying to push legislation through to seize back ownership of some of these estates’ land, also indicating that it wants to end various forms of tax relief for estates.
While this will no doubt means some owners will want to cut their losses and sell up, agents have reported that this is not impacting demand among foreign investors, who view these estates as trophy assets.
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“Most buyers of sporting estates tend to be following their dream of owning a bit of Scotland, and all that entails, rather than being driven by the need to secure a commercial return,” said Evelyn Channing, director of rural at Savills.
“That said, there is historic evidence of Europeans deciding to realize this dream when the exchange rate is advantageous, as it is now. It is early days, but so far so good in terms of the Scottish estate market. Certainly we have had positive interest in such properties this week from both within the U.K. and Europe.”
Estates currently on the market include Baldarroch Estate, in a private setting with salmon fishing on the River Tay in Perth and Kinross for £1.7 million ($2.3 million). As well as the main house, there is a two-bedroom Gate Lodge, a three- bedroom coach house apartment and a number of other buildings, including stables as well as a greenhouse and a large Orangery at the northern end of a walled garden.
As for the possibility of a second referendum on Scottish independence on demand, Andrew Wood, a partner at Bidwells, believes that it would most likely have more of an impact on U.K. purchasers than foreign buyers.