As the votes for and against an independent Scotland are made, EG talks to some of Scotland’s property experts to see how they think a yes vote could affect the real estate market.
THE DEVELOPER
Dan Macdonald, chief executive, Macdonald Estates
“Initially there might be a reaction, perhaps negative, but longer term I don’t think it will make any difference to the investment market. They accord with the tenant and the rental stream, and they will continue as before on that frame. In development terms, I think we’ll see development opportunities if there is a yes vote. I am not at all worried of the future of property development in Scotland.”
THE AGENT
David Murdoch, director of valuation, Savills, Edinburgh
“Property and financial markets are very closely intertwined, and they are often balanced on a knife edge. You only need to look back at what has happened with matters of distinct uncertainty in the past – the investors go away until they feel sufficiently confident to re-enter the market, so if they have to sell they have to discount the price. In all probability it will recover eventually, but it could be three months, or three years.”
Will Scarlett, director, Rettie & Co, Edinburgh
“There will be a period of clarification, and I would imagine that during that period it is possible that a number of projects may be paused. What we don’t know is how long that period of uncertainty will last. Maybe it will throw up some opportunities, but I’m not seeing evidence of that at the moment.”
David Davidson, head of Scotland, Cushman & Wakefield
“I think one issue everyone is concerned about is the UK institutions being forced to sell property because the mandates don’t allow them to own property outside the United Kingdom. I think that is overplayed – either the funds will change their mandates to include Scotland, or if they decide to sell out then they won’t do it en masse. Why would you suffer huge price falls unnecessarily, why not do what the Germans do and exit in an orderly manner over a four-to-five-year period? I think there is a lot of scaremongering going around.”
THE LAWYER
Rhoderick McGrigor, associate, Barlow Robbins
“The upheaval following a yes vote could lead to lower employment, pushing prices down. There would also be insecurity around the new currency: how will the value of a property originally purchased in pounds sterling be calculated in the future? What will happen to the value of a corresponding mortgage, especially if the bank which dealt it moves its base south from Scotland?”
THE ECONOMIST
Jeremy Blackburn, head of UK Policy, RICS
“Inevitably, the referendum on Scottish independence will have an impact on the industry regardless of whether it’s a yes or a no. At the moment, it’s the extent of the potential changes to the construction and built environment industry in the country that are causing anxiety. Potential political changes on this scale always bring an element of risk and uncertainty for investors.”
THE LOBBYIST
David Melhuish, director, Scottish Property Federation
“How quickly the political position can be reconciled in terms of currency and EU membership will be the biggest issues for many in the industry. There are things that people will want to know before they make further commitments. All of this will have potential consequences for values and the strength of the occupier market in particular, and these obviously relate off each other.”
What are you views on the impact of a yes vote on the UK property market? Tweet us @estatesgazette
