THE founder of an upmarket Scottish estate agent has declared the market is “robust and thriving” in Glasgow, despite interest rates hitting a 15-year high.

Property veteran John Kelly, who established Glasgow-based Corum 20 years ago, acknowledged the sharp rise in the cost of borrowing but said it is just one many factors which come into people’s thinking when it comes to buying a house.

He told The Herald that the pandemic triggered an “epiphany” which has fundamentally changed how many people view their home, with more consideration given to whether houses are big enough for families to live and work in, access to schools and recreational facilities, and transport links.

And Mr Kelly said that has not changed in the areas Corum operates despite interest rates surging to 5.25% following 14 consecutive rises by the Bank of England, declaring that there is “misplaced negativity” in the market.

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Mr Kelly, an industry veteran of 37 years, said: “Taking interest rates to one side, the Covid period that we witnessed brought a real epiphany for some people. Once again it has reaffirmed what home means to them.

"It is not a status symbol; it is not a question of “mine is better than yours”. It is a question of: is it the right space to bring up my family? Do I have space to work from home if that is a requirement? Do I have outside space for recreation [or] exercise? And is said property within an area with the amenities I need?

“The Covid period just brought that renewed focus on home. It should be a great, interactive space that works for your family to the best of your budgetary limitations. And it continues to this day… demand still exceeds supply, so we find ourselves in a good place.”

Mr Kelly added: “Yes, [the] interest rate has garnered so many column inches over the past few months, but the interest rate is only one of a number of dynamics that influence and drive the property market. Therefore, we are not wholly dependent on it and we are not wholly at its mercy.”

Mr Kelly’s upbeat perspective is supported by figures that show Corum conducted more than 16,000 property viewings in the first half of the year, a record for the company which compared with around 14,000 over the same period last year.

It is currently on course to lift turnover by around 10% to around £7m in its current financial year, during which it will list more than £600m of property.

Last year, the firm listed £636m of property, which ultimately sold for more than £781m.

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Mr Kelly emphasised that Corum is not “oblivious” to the pressures arising from the current economic conditions, which have created “immensely difficult” circumstances for many people. But he said: “We can only talk about it from our perspective. People haven’t simply packed their bags and given up on the property market. People are still eager to move to the right home and the right environment for them and their family.”

Although Corum operates largely at the higher end of the property market, notably in affluent suburbs such as Milngavie, Bearsden and Newton Mearns, Mr Kelly said the firm does deal with a “number of first-time buyers”.

He has closely observed how this demographic has responded to the surge in interest rates and said that to date he has not heard many people say they are finding it difficult to secure or afford a mortgage. But he acknowledged that the “bank of mum and dad” has been a “significant force in helping younger people establish themselves on the property market, albeit where the bank of mum and dad have sufficient liquidity and comfort around their general finances”.

Referring to the benefit higher interest rates have brought for depositors, Mr Kelly noted: “Obviously, we are starting to see savers feeling a bit better about life because the returns on their investments after tax are meaningful now.”

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He also said there have been signs of lenders reducing mortgage rates in recent days, as forecasts begin to harden that a peak to the recent pattern of interest rises is in sight. In his view, the Bank of England will raise the base rate by a further 0.5% by the end of this year, though he expects it to be 2025 before the rate begins to ease.

Mr Kelly said: “There seems to be a great willingness and a good level of liquidity to lend. I think lenders are looking at products to help first-time buyers.

“Although mortgage rates are up significantly on where they have been in the last decade, they are still far from being historically high. There is probably an end in sight to the rises in base rate.”

Corum has grown from an initial eight staff and three branches in 2003 to a team of 74 people across nine locations throughout Glasgow, Ayrshire, and the west of Scotland. It is actively recruiting further staff.

Asked if the company would consider moving into new areas, Mr Kelly said: “Definitely. We are of a mind to be acquisitive at the moment, we would like to expand our network.

"We believe we could constructively overlay our brand and our ethos onto areas where we are not active at the moment and would like to grow our business over the next two to three years geographically.”