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July 8, 2011 5:09 pm
Appetite among wealthy individuals for prime country homes is on the rise, as buyers search for bargains in a market where prices are now falling for the first time since 2009.
The latest Knight Frank Prime Country House index found that the price of a typical country cottage fell by 1.1 per cent year-on-year to the end of June, while farmhouses were down 0.4 per cent and manor houses 2.7 per cent.
Agents say that the price falls are presenting buyers with opportunities.
“The market outside of London is still struggling to build momentum,” says Liam Bailey, Knight Frank’s head of residential research. “The London effect – 34 per cent price growth in a little over two years – has so far not had a huge impact on the country house market.”
According to Knight Frank, the only country properties to show double-digit growth since the market low point in June 2009 are £1m-£3m houses in southern England, which are up 10 per cent. Overall, the country house market has risen only 6.4 per cent during this time.
“There are some great opportunities to be had in the country market,” says Rupert Sweeting, head of country house sales at Knight Frank. “Areas such as Rugby in Northampton and Broadway in the Cotswolds have prime country homes for sale at 2005 prices.”
Knight Frank predicts that prices will stabilise at current levels, particularly in the £1m-£5m market, but says there is scope for some limited price growth in the second half of this year.
Sweeting says international interest in 3m-£5m properties from eastern European and Chinese buyers could start to push up prices in this sector.
“Another area of strong activity in the country homes market is the waterfront market in the West Country,” he says. “There have been a number of sales [in this region] to buyers looking to invest in holiday homes, suggesting that the ‘discretionary buyer’ – who views a holiday home as not only an investment but as somewhere to enjoy – is back.”
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