House price inflation in the country house market fell by 0.2% in the first quarter of the year, putting annualised house price growth at 4.5%, the lowest level since the beginning of 2006, according to Knight Frank.

The weakest two sectors overall were manor houses and country cottages, which both fell -0.4%. Farmhouses on the other hand managed to show growth over the quarter of 0.3%.

These figures are evidence of a gentle correction filtering through to the country house market, the report says, although there is no evidence at all of a serious loss of value. The situation for sellers is that they are reluctant to enter the market in such uncertain times, and if they do so they struggle with offers which they feel don’t meet their expectations, and buyers are only prepared to pay for properties which not only meet but exceed their expectations.

Sales volumes are expected to be down by around 25% on historic figures, so vendors are to be prepared to sell for a reasonable price. However, Rupert Sweeting points out in the report that a two-tier market is now developing where good properties are achieving exceptional prices due to a lack of supply: ‘In the first quarter of this year across the London and country market, we have already sold half the number of properties over £10m that we sold in the 12 months of 2007.

‘It therefore appears that a two-tier market is developing where immaculately presented manor houses are not only selling well, but because of their rarity are also attracting a premium over their original asking price,’ he said.