Prime country house prices increased in value by 0.8% in Q3 2013, according to the latest data from Knight Frank.
While prices for London’s best homes are 24% higher than their previous peak before the financial crisis, country house prices remain 20% below their respective high in Q3 2007 but there are large variations in price growth depending on location with the largest price rises in commuter towns close to London.
Demand for prime country homes has been strong so far in 2013, with an increase in both demand and sales volumes across the prime market.
Oliver Knight, of Knight Frank’s residential research team, said: “The gap between the price of luxury homes in central London and the country is at its widest in several decades. An average country property valued at £1million in late 2007 is now worth £800,000. In contrast, a London home valued at £1million in 2007 has increased in value by £230,000 over the same time frame. This means someone who had wanted to move from the London property to the country property in 2007 but who had put it off, would now effectively have an additional £430,000 left over – which they could use to invest in a larger property or to buy additional land.
“Our recent data indicates that the gap between prime country and prime London homes may start to shrink a little. Average prime country properties increased at their fastest pace in over three years during the third quarter of 2013 and we forecast country house prices will continue to increase in the years to come.”
Rupert Sweeting, Head of Knight Frank Country said: “In the last 18 months as buyers of country property have realised the gap between London and country, prices has never been greater. They have realised that their budget can enable them to buy a better house in terms of value and which may have more land, outbuildings or even a cottage. Alternatively they have been able to buy their house in the country and purchase a pied a terre in the town enabling them to keep a foothold in the London market.”
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