High value properties showing strongest price growth

Country houses valued above £5m saw the strongest price growth of any property type in the UK in the three months to June, according to Knight Frank.

The real estate consultant suggested this is due to interest in country living and the greater ability of buyers in higher-price brackets to transact.

An increase of 1.2% was recorded in the second quarter of 2020, despite property markets being closed between late March and mid-May as a result of the COVID-19 pandemic.

Knight Frank reported that its overall Country House index was “flat”, as increased demand for outdoor space and greenery offset the impact of coronavirus.

“Buyers at the top end of the market have been willing and able to move quickly to secure their desired homes as lockdown restrictions have eased,” Knight Frank senior research analyst, Chris Druce, commented. “The relative scarcity of homes available at this price point can spark competitive bidding, which has put a degree of upwards price pressure at this end of the market.”

Knight Frank also suggested that price growth for higher-value properties has also been weaker than the wider market in recent years due to a series of tax changes – leaving greater scope for future rises. While prices in England and Wales grew 22% in the five years to March 2020, the Knight Frank £5m-plus index fell 8.1%.

The real estate consultant’s analysis of offers accepted outside of London between 13 May and 24 June revealed that the £5m to £10m price bracket has come back more strongly than the rest of the market. The research also indicated that the number of offers accepted was 182% higher than the five-year average – compared to 64% for all price brackets.

“People are sensing an opportunity now,” partner in Knight Frank’s Country Department, Edward Rook, added. “In the previous three or four years there have been consistent bumps in the road and the clear water people were looking for never came. We had that at last after the General Election and then the lockdown came. People have simply decided it’s now or never.”

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