Ever since I moved down from Aberdeen we have been talking about moving to a bigger flat. Now we have decided to take it a wee bit more seriously and get out and look to buy a new place, so we are house hunting in Edinburgh. As with so many things, the internet has changed the way we live our lives.
Back when my parents first decided to buy a house in Nairn, they set out to visit all the local solicitors. I should point out here that Scotland has a different legal system to the rest of the UK (under Article XIX of the Act of Union 1706), and property has been traditionally sold through solicitors rather than estate agents. Although there are a few estate agents now, most transactions still are with the solicitors. So, in the old days, the first step in searching for a house was to hit the High Street and visit all the local solicitors to find out what property was on the market. Fortunately for my parents, Nairn was, and still is, a small town, but in a place the size of Edinburgh this would be quite a different proposition.
So back in the early 1970s an enterprising group of Edinburgh solicitors got together and formed the Edinburgh Solicitors Property Centre (ESPC). This provides a one stop shop for anyone buying or selling a house, as it covers the majority of domestic property for sale in Edinburgh and its surroundings. Up until a few years ago, regular trips to the ESPC “shop” George Street to see what was new on the market and pick up the schedules was a regular part of the house hunting process. Now, with broadband access, the trip to George Street is no longer necessary, as the ESPC web site provides this service.
Once the price band and area have been decided on, the house hunter then searches through the on-line schedules to draw up a list of properties to visit either on Thursday evening or Sunday afternoon. In Edinburgh open viewings are the norm for most of the residential property market. The way this works is that property is available to view between 7&8 pm on Thursdays and 2&4 pm on Sundays, anyone can just turn up and have a look around. This system gives buyers a good chance to get out and see a number of properties in the same area in a short time. If you see anything you are interested in, you then ask your solicitor to put in a note of interest. This means that the property won’t be sold without you being given the chance to make an offer. When the seller feels that sufficient notes of interest been received, a closing date is set. This provides a deadline by which all offers have to be submitted to the seller’s solicitor.
In Scotland most property is sold on an “offers over” basis, i.e. the seller sets a price which the buyers then bid over in a sealed bid auction. The seller then normally chooses to accept the highest bid, but is not obliged to accept any of the offers. Other properties are sold at a fixed price, in this case the property is normally sold to the first person who offers the asking price. Once a bid has been accepted, it is legally binding on both parties (subject to conclusion of missives), therefore there is effectively no gazumping in the Scottish market.
The downside for buyers with the “offers over” system is that, in a competitive market, buyers can be outbid on multiple properties. Until recently it was common practice for buyers to commission a survey on each property which they made an offer on, which resulted in multiple surveys being carried out for each property sold. Good news for the surveyors, but a real drain on resources for unsuccessful bidders who paid for all these surveys. In an attempt to alleviate this, the Scottish Parliament proposed a scheme whereby the seller would be required to carry out a full survey, the results of which would be provided to the buyers, the so-called “sellers pack”. This hasn’t been met with any great enthusiasm from either buyers or sellers. The solicitors however came up with a different approach, making the offer subject to survey, this in effect means that only the successful bidder has to pay for a full survey.
At the current time we are still some distance off from making an offer, although some of the flats we have recently viewed have been tempting.