Prime country house prices in England rose by 1.1% in the second quarter of 2014, taking the annual increase in prices to 5.2% over the year to June, says Knight Frank.
Although still playing ‘catch-up' with the prime market in London, where prices increased by 7.8% over the year to May, this is the strongest rate of annual growth in the prime country market in four years, the agent has reported.
Looking at market activity, the volume of prime country sales completed in the second quarter was 11% higher than the corresponding period last year. This was driven primarily by the sub-£2m market which accounted for 80% of Knight Frank sales over the three months to June.
On a regional basis, the Home Counties markets have continued to benefit most from the 'London ripple' effect, with house price growth spreading outwards from central London.
Additionally, these markets are being boosted by the return of London buyers. This is reflected in country ‘hotspots', many of which are close or within commuting distance of London. Prices of prime property in Winchester and Cobham rose by 2.6% in the second quarter, while prices in Virginia Water were 2.5% higher and in Oxford values climbed by 1.8%.
Looking to the future, there are signs momentum may be slowing slightly, as the number of prospective buyers registering their interest in buying a prime country home has fallen slightly. Knight Frank's Rupert Sweeting comments: ‘After little or no price growth for a couple of years, the increased activity in the country market is slowly filtering through to price growth. Counties like Hampshire are seeing a significant increase in sales reflecting renewed confidence from London (and often city employed) buyers. The ripples have not reached the far-flung counties which are, as a general rule, more than two hours from London, unless the property is exceptional.
‘As ever those houses that are near perfect are attracting strong interest and this year we have seen competitive bidding return.'
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