The ESPC Property Show: Listener Q&A

Paul
Hello, It's Paul. And once again it's Megan. And we've called this the, I think this is the “see where it takes us” episode

Megan
Yeah.

Paul
because you've got all the questions and we've not even done a dress rehearsal so

Megan
Yeah.

Paul
I’ll be in the moment with these things.

Megan
Yeah. This is one take wonder. We put a little call out for some listener questions. I've also gone away and put together some points up that Paul and I can talk about. Paul is coming into this blind.

Paul
Absolutely. So I do feel like I'm here for job interview.

Megan
It's no, no, it's not going to I'm not going to catch you out on anything. So a couple of the things we're just going to answer questions from. Yeah, what some of our listeners have popped in, the questions have been collated from direct message on Instagram, LinkedIn and but also some of the comments on our YouTube channel. I mean, just friends and family as well, who have chipped in.

Paul
And we'll freestyle from that.

Megan
Yeah, exactly. So I think just to kick us off, we our first question was where would you both recommend as places to live in the area?

Paul
Okay. So in the core area that we operate in, yeah, again, maybe it's some of it's going to be where we've been already in the podcast, I would say. I mean, certainly if I'm basing it a little bit on statistics and things, I'll start off with Dunfermline. I think we've we've learned a lot from going there.

Megan
Yeah, definitely.

Paul
Affordability, good amenities were good, I think up and coming. It's already very established, but I think it's having an even greater resurgence but I would say Leith. Again, it’s our biggest volume of sales, the tram bounce that we we've referred to - you love Leith.

Megan
Lovely I love Leith. I love going down to Leith and actually it's interesting that you should have mentioned those two because I actually already pulled the data from ESPC.com and our top four locations. The top two were Dunfermline and Leith, and then we had Corstorphine and Musselburgh.

Paul
Yeah, more, more sort of semi I think more established.

Megan
But I think yeah, if anyone's looking to move, those places are popular and are lovely places, we can give them our stamp of approval. And so the second question could be a little bit more controversial. Okay, we got as a comment on one of our YouTube videos and it was if prices are not going to drop, which is what we've kind of been seeing. Yes. And then the market isn't actually that attractive to buy in.

Paul
Okay.

Megan
But I wanted to ask what your rebuttal was to that.

Paul
Okay. Yeah. No, that's it's a interesting comments, isn't it? I mean, and again, I suppose what's my attractive may not be someone else’s attractive. It I think the answer to that question is really you buy when it's the right time for you and not that and it's your circumstances as well, isn't it. You know, if you're moving to an area for maybe a year or two years, you really have to weigh up, Is it better to simply rent somewhere or do you buy? Because if you buy, you have got LBTT. So you know it's going to cost you that the tax is going to cost you.

Megan
Yeah.

Paul
A lot of associated costs. You know, are you ultimately better off renting. Maybe, maybe not. Again, there's no right or wrong wrong answer. The right answer. It's wherever it's best for you. I think certainly I can speak from experience having sort of monitor the market and all the data. You think we'd all be living in palaces now because we always call our sales, right?

We know what to sell, when to buy. I've never really bought the dip and caught the top of the market. So, you know, I think it's very different call and you can wait on the sidelines and continue to wait and things don't change significantly. We have seen a slight, as you know, fall in the average sales price. We think there are a contributing factors, but we've not really seen that huge recorrection. And again, I generally don't think we will. I mean, just earlier in the week, you know, when you're talking to lenders and you're talking to the Bank of England, and what's clear is that there's no we don't think we see a large amount repossessions come to the market. The government is doing everything it can to avoid people ultimately losing their homes.

And so if you don't see that massive surplus of supply, I think we will have a reasonable market still. But, you know, again, everyone's opinion is valid, isn't it? And, you know, as I say, maybe the market is more attractive to if if it dips and yeah, we'll see.

Megan
Yeah, absolutely. So third question is a bit of a long one, a little bit maybe complicated, but basically we were asked if with regards to this, this is in regards to bidding over Home Report value. So to ensure that you are the successful buyer. A lot of people are looking at how much do you have to have cash in cash before I make an offer.

Paul
Yeah.

Megan
Yeah. So looking at their savings, looking at how much potentially what how much they would have to save, but, working out what that would be. So in terms of the percentage over Home Report value, does the percentage paid over the home report value vary depending on property, style and age? And or is it more on area and size?

So is it more square meter range or is it more to do with the aesthetic appeal?

Paul
I think the square footage can be a guide. I think it's a crude guide. And generally even when you talk to surveyors, they're not huge fans of using that, they'll go off comparables. I think when we talk about offers over, yeah, we know the average is about 104% at the moment being higher last year. It's just the average.

So even within that there's some that are achieving 101% and have reported I think it was achieving 109-110%. Why the variance? I think ultimately it comes down to supply and demand. If there are if you say the West End, for instance, if there were if there's just one property for sale in the West End in the next year and that's the only property for sale, they'll get a good price if there's 100 boards up in the West End and 100 properties for sale, we know that will suppress prices.

So it's simply comes down to supply and demand. And I think clearly in some of the more historic parts of Edinburgh, what you do know is they're not going to build any more property. So there's always going to be a premium paid. Yeah, okay, you may see some more conversions and we are seeing that in bits of the city now and bits of the West End where office accommodation is being converted back to residential as people, you know, the hybrid working things out.

So so again, there's a little more supply, but we're not going to see a fundamental shift there. So yeah, it really is more about the property and what the market is doing at that time and what the supply of properties is, is like at that time and how badly you want it.

Megan
Yeah, that's what I was just going to say because a lot of the factors that was meant there were mentioned here in terms of the style and the size and area they're built into the home report value. Yeah. That's, that's what this Leicester deems your home to be worth. Then the extra is just how much you want it.

Paul
You know it's, it's worth difference. It's like a piece of art, It's work, it's interpretation. It's, it's what it's worth you. For instance, if you want to buy a house because it's next door to your mum and dad, arguably you might pay more than the next person. And so it really is a very personal thing. And again, probably the last one, you know, I'd say this go and talk to your solicitor estate agent.

They'll look at all the archive data. They'll tell you what's selling and what prices, and they'll probably rein you in a bit if you get too giddy. I remember my first one, I was, I've seen it, I want to buy it. I've got a mr. Lister, Steve Morley. God rest his soul, said, Just wait. Let's just ease back here for let's let's take our time.

Let's look at the market and see a few more and we'll think about what we need to offer. You know, so, yeah, I think just getting that advice and just getting a reality check I think can help.

Megan
Yeah, absolutely. So actually you touched on supply and demand. So we're going to take a little pause from questions and I am going to share some information on a topic that we have discussed actually in last week's episode with Debbie.

Paul
Oh, yeah.

Megan
About the economy - something that we bring up a lot is the basket of goods.

Paul
Basket of food. Okay, well, it's not food. This is not everything, you know.

Megan
So I went onto the Office of National Statistics.

Paul
Has it got a Mars Bar in it?

Megan
I went on to the Office of National Statistics website and I pulled up the basket of goods. Now, I'm not going to read you every single item because there's over 500 rows on the spreadsheet that I downloaded. So I think we would be here for way too long. But what I did think was I pulled out some of the 2023 additions to the basket. Okay? And then I thought I would let you know why they had been added.

Paul
Okay. And I think what the basket is supposed to do is give you a cross-section of things that you might buy and a broad indication of various items as to what impact inflation has had on them. You know, so some might be higher, some might be lower.

Megan
Yeah.

Paul
and there might be a Mars Bar in there.

Megan
Well, I don't think there is as this this basket of goods doesn't have any brand here but a yes. So basically what they do is every year they assess that list if they feel there are some sections that aren't fulfilled enough, feel at some point, but then they'll remove bits that seem irrelevant. So I'll read you the list of all of the categories first, and then just to give our listeners as well an idea, if you've never heard of the basket of goods, here's just a little top line introduction. So we've got 12 categories. The first one is food and nonalcoholic beverages. Second is alcohol and tobacco. Three is clothing and footwear. Four is housing and household services. Okay? Five is furniture and household goods. Six is health, seven is transport. Eight is communication, nine is recreation and culture. So things like cinema ticket at ten is education. 11 restaurants and hotels and 12 is miscellaneous goods and services.

Paul
Okay.

Megan
So it's really to give a broad sense of what people are spending their money on in the UK. So I went and had a look through some of the items and there was quite a lot added as you would expect because there's quite a lot in the basket. But one of the things that stood out to me was, which is number one is tortilla wraps.

Paul
Tortilla wraps?!

Megan
So they have been added because the bread and cereals section, of are underrepresented in the basket at the moment. So wraps and tortillas had the highest expenditure. So that was the product people were buying the most. And after the existing basket items and they're widely used for main meal dishes as well as sandwich options. So people, people are using them more. So that's why it's added.

Paul
Oh right. So they see how many are selling and things like let's go to the charts and there's other things like over the years like lard have dropped off.

Megan
Yeah, exactly. Okay. Something that I am also has dropped off. I was supposed not going to mention this, but actually I will. It up was 20 super king size cigarets have been removed because people.

Paul
Probably didn't surprise here. I mean yeah as an example that's just getting priced isn't it. Yeah. Price that out.

Megan
And so yeah, I find it a really interesting read this because it kind of gives you a nice overview of what trends are in people's shopping habits.

Paul
It really is.

Megan
A The second thing I wanted to share was that frozen berries had been added.

Paul
Okay, people are making more smoothies.

Megan
That's exactly what they said. Yeah, that's what it said. Expenditure is growing in this area due to greater health awareness and the popularity of homemade food and.

Paul
Smoothies, doesn't it? So we saw we've seen a boom in that and a fall off of smoking, which again is representative of where we're headed.

Megan
Yeah. I do think e-cigarettes and vapes are probably still on the list.

Paul
If they’re not in the basket. They’re going in the basket.

Megan
So yeah.

Paul
I'm sure they're going to lose powdered egg or something. Yeah, it could be.

Megan
Yes exactly. And then another one that was added and this will be my final one, just to let you know was video doorbells. They've been added. So in the security and surveillance section that's been added because expenditure is going up so people are more people are buying it. So I think that's the purpose of the basket of goods is to be on the ball with.

Paul
Representative of demand across the country for certain items. Yeah.

Megan
So this is just the Office for National Statistics. One, I'm sure there might be other ways to do it. And it was really interesting things like men's belts were also added a red wine.

Paul
How many men's. I've had one for years.

Megan
Yeah, well that's why I think they said a men's clothing accessories had been underrepresented. Okay, So they were adding in more products.

Paul
Blokes don't generally have many accessories. I don't know. I don't know of, you know, the younger generation. Just a belt, that’s it.

Megan
I think so. Yeah. It was it was really interesting and yeah I think a things like the we used to classify red wine into categories European and New world and even I condensed into just red wine.

Paul
I'm pleased about that.

Megan
So yeah so yeah that was a nice little throwback to your last week. I thought that was is there anything else that you think you would add to the, to the basket?

Paul
The thing that's in demand mind, I mean you mentioned vapes. Yeah. I think things like what about Amazon Fire sticks, those sort of things. Have we seen increase in those things in recent years yet.

Megan
Video on demand subscription services. Yeah. Yep. They're there so yeah. So this is when people ask what inflation is it's basically the difference in price of these baskets, of the items in this basket of goods.

Paul
It's good work. Yeah. Yeah. We need to do more research for our shows that we need researcher.

Megan
Yeah. So we'll go back to the questions now. So we've got a few first time buyer questions which we will be answering next week in next week's episode. Yes, in a lot more detail, but we'll just give some some quick answers just now. So somebody said, I'm new to Edinburgh and I've just come here from England. I'm hoping to buy for the first time soon. Do you have any tips? Now, Paul, you have bought and sold in both Scotland and England.

Paul
So I can tell you with certainty I'd much prefer to buy and sell in Scotland from England. Scotland is a lot more straightforward, a lot more certainty earlier on. I don't think that would be the change that somebody coming from England would notice. And in addition, when you're from England, generally you'll put an offer in direct to the estate agent.

So and whereas here you need a solicitor very early on and they'll represent you. And as I say, they'll guide you. They've got you. Which is more important. So yeah, I think the only advice I can really give would be go find a solicitor estate agent as early as you can and get them by your side to help you navigate through the purchase.

Megan
Yeah. And you'll be able to find a solicitor estate agent if you come along to a first time buyer event, which the date is still not confirmed yet, but it will be in the show notes for this course by the time this episode airs.

Paul
We should be a good start and people can just pick up.

Megan
So a second first time buyer, somebody says hopefully a soon to be first time buyer here. Should I be speaking to a mortgage broker?

There's the answer. Yes. Yeah. And again, we say it sounds like there's a bit of a pitch. It's generally not meant to be. If you go to a bank, you're going to get the best rates on that particular bank. If you go to a mortgage broker, it'll look a whole the market is a big, big difference. Yeah, I think certainly in the moment when you're making that commitment and you're debating between a fixed rate and a variable rate and all the things to consider.

Yeah, just go look at the whole of the market. You know, it's the best way to go forward.

Megan
Yeah. And again, not to do too much of a pitch for ESPC mortgages, but well, we can they're, they're our guys and they are independent so they work. They will find the best option for you. They'll learn about your circumstances and pick the best option and find the best product.

Paul
Yeah, I'm you know, I'm not sure the difference between if you if you're in a fortunate position where you've got a big deposit, the difference it makes between putting down 5% and 10% or 15% is significant. So it.

Megan
It really is.

Paul
You know, and again, now we see more fixed rate properties as we say on most shows. That means hopefully you're not having to get caught up too much in the offers over and you can ultimately buy a fixed price property. You may have a little more deposit.

Megan
Yeah, absolutely. And we had a question which we’ve kind of already answered, but I'll ask anyway, are there any up and coming areas that you think worth looking to buy in.

Paul
I think it’s written in the stars And I think we have to do another special and do a Leith special because I think Leith you know from everything we can see just involving ourselves as you describe there, it's in demand. It's always been in demand but I think more so in recent times.

Megan
The thing is I remember a long time ago being told that Leith was up and coming. It's been up and coming for a very long time. And I do think it's almost, it's almost there.

Paul
And you know, it's always becomes one of those things. It's self-fulfilling isn't it. It's more confidence and then there's more inward investment and then it's more confident in this, more inward investment. And the thing just continues to grow. And I think a lot of this brownfield developments as well, where, you know, factories and things of the past have been cleared and now the build new property again, that's certainly good for the place, brings more people in and they spend that money locally.

Yeah. I'm wondering, you know you’re down in Leith, I've heard this said by people who work for ESPC. Oh, I never come into town anymore. I don't need to. I'll just do everything in Leith. Yeah, that's really interesting.

Megan
Yeah. Yeah. I mean, I hate to say it, you know, I live in Portobello. It's the same there.

Paul
Yeah, Yeah, absolutely.

Megan
And a lot of things. I don't really have to leave Portobello to get to, but that's hard. 20 minute neighborhoods topic, but yeah I guess so. Actually, let's chat through some of the episodes we've seen so far. Yeah, that's because that make that make sense to move on to that. So obviously we went down to we went on a bit of a road trip that we did.

Paul
So yeah, I should have written these down, but Dumfries and Galloway and the Southwest as we call it. Yeah, really enjoy that trip. So we learned a lot. It's great. See the project in Dumfries itself, you know, again, community based subscription people put money in making a difference, um, repurposing a building that was lying empty, I thought was really inspiring.

Megan
Yeah. And I think there is that's happening more and more across the central belt as well I think with the community ownership.

Paul
Yeah, we're going to do some more work on that side. Yeah. Because I think it's a really interesting, you know, it's people taking action and positive action and doing something to help themselves. And I think that's great, you know?

Megan
Yeah, absolutely. And I think it was really interesting because we went along to Dunfermline, we've already mentioned we were in Dunfermline and then down to the Scottish borders, which was lovely. And it's such a large area that we didn't even really scratch the surface.

Paul
We need to go back to that place that was mentioned.

Megan
Innerleven.

Paul
You've got a great memory, so we need to go there? Didn't see Innerleven, which I think we drove past but we were in such a hurry to get feels we didn't go but yeah and I think certainly you know the Borders it is very clear it's had a real bounce with people moving out because of hybrid working or people moving to the borders.

You know, the train line helped a little bit, but I think it's really pushed on because to see people not having to do that commutes everyday. So, you know, that's really benefited the Kelsos and the Hawicks and the Peebles in the weeks and peoples of this world. So it's you can see that in the figures and the volume of sales and the volume of sales and the speed of sale.

Megan
Yeah, and I think I underestimated just how close to the the border is and how close is to the likes of Newcastle and, and traveling south as well as north. So yeah, I think that was really good. And who else did we have on the podcast?

Paul
Debbie.

Megan
Yes, Debbie.

Paul
Talked about the economy, which I think that episode may is it out by the time people watch this?

Megan
Yeah, that was last one.

Paul
Yeah. Really good. Again, incredibly knowledgeable and just great insights. And we all thinking about doing a basic 101 in the economy for everyone including us.

Megan
Yes.

Paul
Let's talk it through in a bit more detail but I thought was fascinating to listen, which I'd say we should things the economy might be going but we won't spoil stuff.

Megan
So yeah and we also had our quarter three market update with Lindsey & Maurice, which I thought was really popular. You know, a lot of people downloaded that episode and listened along and watched along and I think we learned a lot as well. Just that that nugget of insight from.

Paul
Maurice’s list!

Megan
Yeah, we had a Facebook comment on that clip and somebody said that would have been going wrong.

Paul
Yeah. So to say, wasn't it? You have a list of ten things and if you tick nine, the thing is probably you're not going to be able to tick is the price because it's it's just going to be astronomical. So accept 8/10

Megan
So yeah.

Paul
There's a musical reference in there - you can’t always get what you want.

Megan
But yeah, so that was all of my talking points. And also know we had one more question.

Paul
Okay.

Megan
And what does it mean if it's one of your solicitors estate agents is an ESPC chartered firm? What does that mean?

Paul
Chartered firm. Okay. Yeah. So not every ESPC firm is chartered. Um, but certainly what we've done with our firms and you'll be able to identify on the ESPC.com, we recognize that the government is going to bring in legislation for estate agents in the future, meaning that everyone needs to be licensed. We want to get ahead of our ahead of the curve really by improving standards.

So we doing two things. There's a this charter which sets out a high standard of what an individual can expect if they use a charter firm to buy or sell based on their expectations and clear black and white, plain English people understand what they're getting. And secondly, the firms are committed to continuous improvement through training. So we've done a lot of training with them this year and we're coming towards the end of that training and will then they will graduates and we will continue to do that training next year.

But it sets them apart. And as I say, that's that's all been voluntary and that's firms saying, Yeah, put me through that, I'd like to learn more. And we've covered a lot of that training. We've done building construction, conveyancing, property law and really going into detail on a lot of subject matter data protection, and it just gives them a real broad base.

I mean, we've got many people so experienced anyway, but I think we've brought more insights to them. But as I say, I think the charter itself is about driving standards up in the profession. I think it's already higher than England, but we want to go further and I think solicitor estate agents want to go further than the independents and I think the charter allows us to do that and it's a living document.

So we keep getting feedback on where we could do better and then we incorporate that into the charter and we ask all firms to reach that new standard. So the ball is going to be continue to be raised.

Megan
So Paul, I think that's everything that we were going to chat about is there anything else you want to speak about?

Paul
I don't think so. I'm conscious we don't want to repeat. Well, you know the great advice that's always been said on the podcast you don't you don't want to labor these points.

Megan
Said this, but this episode is a halfway point season. So we do still have, I think, nine more to go. So this is ten, so we've got nine more to go. We've got our first time buyer special next week and we have got some energy efficiency episodes coming up.

Paul
That's going to be good. Actually, I thought the the government's just first in consultation this week on energy performance certificates and you know, there's real change now we're seeing more and more sellers and agents put more emphasis on this. And in the brochures, you know, in the schedule about the work that's being done. So I think, you know, things are changing and we're we're going to see that change and accelerate.

And so it's an interesting time to be talking to them because they're doing a lot of work and a lot of it is retrofit. So beyond all the properties, what you can do, how you can do it and how you can do that in a low cost way as well.