Demand is surging in South West England’s country markets.
Pandemic Issued Wake-Up Call for British Country Markets
Hamish Humfrey, a partner in Knight Frank’s country department, said that pre-COVID, buyers wanted to be within a comfortable commuting distance, about one hour from the center of London. Once the market re-opened after lockdown in 2020, buyers extended their search to include true countryside areas that were well over that one-hour boundary.
Such demand continues. Humfrey said, “There is a huge amount of demand for people coming out of London looking for a different lifestyle…” either on the coast or in the countryside.
Pre-pandemic, the South West “was a relatively good value” – 15 to 25% less than other areas in the country. Humfrey said that this good value holds true today despite prices having risen. “…(buyers) will get more for (their) money.”
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Uptick in Sales and Prices
Significantly, the number of homes with price tags over 500,000 British pounds ($652,000) skyrocketed +167% from 2019 through 2021.
Home prices in the South West of England increased +6.3% from Q1 2021 to Q1 2022, according to data from Tim Vooght, national PR manager at Savills. Homes in the cities of Truro saw home prices rise +16.7% y/y; Exeter experienced a home price increase of +12.1% y/y.
George Nares, director of the country department at Savills, said that red flags in the housing market such as threats of rising interest rates, the war in Ukraine and a struggle economy are not dampening demand, “particularly for more prime properties.”
Whether contemporary or 500 years old, buyers want move-in ready homes that do not require much work. Buyers are also looking for Georgian country houses that come with ancillary accommodations and a “block of land,” defined by 10 acres give or take. Humfrey said that such properties, when available for sale, typically sell for between 2M and 5M-plus pounds, often via bidding wars due to scarcity.
Hot Areas
James Klonaris, the prime appraisals manager with the estate agency Inigo, pointed to the highly desirable South West areas of West Sussex, Cornwall, Devon, Somerset, Wiltshire and Gloucestershire where he sells listings in the range of 1M – 7M pounds ($1.2 – $8.6M.) Most of these listings include approximately four acres that buyers want “…as protection from development around them.”
Klonaris also pointed to contemporary homes in the coastal areas of Brighton and Chichester as highly desirable .
Savills’ Nares said that Bath is a “big draw” for Londoners who want the combined benefits of more space and city life.
Who’s Buying in South West England?
Klonaris said, “An exodus of the young” are buying country homes in the South West. US buyers “ebb and flow” along with buyers from Canada, Germany, France, Denmark, Sweden and Australia. Of course, international buyers whose work takes them to England occasionally are active in this market niche.
Humfrey said expatriates who are returning from a decade or two in Singapore, Hong Kong and Dubai are snatching up country homes in the South West.
Buying Basics
There are no restrictions on foreign buyers in England however, most British lenders do not loan to non-British residents. Most non-cash buyers look to specialist lenders and international banks for assistance.
Dominika Bullegas, a real estate attorney with Healys, recommends that all buyers initiate a “full structural survey” of both the internal and external areas of a property in the South West. Bullegas also recommends hiring an attorney who specialized in properties of architectural or design interest for protected homes that would cost anywhere from 2,500 to 15,000 pounds ($3,100 – $18,400.)
Attorneys can shepherd the sale from contract through closing, including registering the transferred title with the HM Land Registry for fees usually based on purchase price and complexity of the transaction.
Sellers pay commissions, usually 1-3% pf the sale price, plus additional value-added taxes. Non-British residents pay 2% higher stamp duty taxes than British residents. If a buyer already owns one home in England, an additional 3% charge is added to the stamp duty tax (5-12% depending on purchase price).
Thanks to The New York Times.
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