Townhouses are on the up, and are retaining their value better than other properties-that’s the message from leading estate agents. According to a study by Savills, their value has fallen only 1.7% in the past 12 months, which compares favourably with those of country houses (-2.3%), farmhouses and barn conversions (-2.5%), country cottages (-2.7%) and flats (-3.1%). This tallies with research from Halifax, which found that, over the past 10 years, terraced houses were the style of property to have increased most in value, up by an average of 68.4%, compared with a rise of 52.8% across all properties. Terraced properties also saw their share of all home sales rise from 31% to 34%.
There are several reasons for this: an important one is that retirees are increasingly looking at townhouses when they downsize. Although some are put off by the flights of stairs, others find townhouses attractive because the large rooms mean that favourite pieces of furniture can still be accommodated. Also, as Nick Mead at The Buying Solution explains, ‘the top floor usually incorporates second and third bedrooms that can be shut off when not in use’, which suits those who need extra space only a few times a year when grandchildren come to stay.
Another big driver for the townhouse market is the impact of relocating Londoners. As Richard Barber at W. A. Ellis points out: ‘Townhouses have always been popular in London because they were the first houses developed by the Victorians, so they tend to be in the best locations.’ Now, however, Londoners are also driving demand elsewhere in the country, as Ben Pridden of Savills explains: ‘A typical family buyer of a York townhouse will often be from London, and could be trading a two-bedroom Wandsworth or Fulham flat for a four-bedroom, 2,500sq ft family home at £400,000-£600,000. Rates of £200-£250 per square foot (psf) are less than half the values in prime London.’
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Similarly, townhouses in the West of England are becoming increasingly popular, partly because ‘they suit Londoners who want to move to the country, but still have the convenience of living in town,’ says Rupert Sturgis from Knight Frank in Cirencester, who reports ‘a high demand for townhouses in the Cotswolds at the moment’.
Indeed, says Adam Lock of Savills in Bristol: ‘The market for townhouses is far stronger than for flats and country houses. Relocators from London often prefer to be in town and bring London equity into the townhouse market here. For London buyers the prices look good value at £300-£450 psf. Prices here are not quite back to peak, but no more than 5% below. We’re busiest in the £800,000-£1.5 million price band; above £2 million, demand thins out.’
However, he adds, surprisingly, townhouses appeal to local buyers, too: ‘We’re also seeing people coming in from outlying villages, typically with slightly older children.’ This point is echoed by Savills’ Andrew Cronan: ‘We’re seeing much stronger demand in Bath compared with the surrounding countryside. The greatest is for townhouses in the £750,000-£1.5 million band, mainly from people moving in from the country looking to scale down their holding in terms of land.’ Rob Jones-Davies of Middleton Advisors observes that ‘as it becomes increasing difficult to find the archetypal country village offering post office, pub and shop, buyers have turned towards the larger traditional market towns, and their townhouses, as an alternative’.
And it’s not only domestic buyers that are contributing to townhouses’ popularity. ‘Due to their manageable size and the potential to “lock up and leave”, international buyers like them as a bolt hole within the relatively secure English property market,’ says Mr Jones-Davies. In some areas, however, this growing demand is stifled by an acute shortage of supply. Take Winchester, for example. Savills’ Steven Moore says that: ‘The classic four-storey terraced house is extremely rare, and we simply never hold a stock of such properties because they sell within weeks of launching.
The current economic uncertainty means supply will get worse. Owners in affluent areas tend to batten down the hatches and stay put so fewer properties come to the market, which means that prices and desirability can go up when other markets are falling.’