Sandbanks was the unlikely millionaire's playground on the South Coast that hit the news when its house prices rivalled Tokyo, New York and Belgravia. But could the good times last?...
Whatever else you say about Sandbanks, it's undeniably a very special place of natural beauty.
This tiny spit of sand that projects into Poole Harbour offers what is claimed to be the best beach in the UK, a stunning harbour, nature reserves, and not a kiss-me-quick hat or a hen party in sight.
But it's not just the splendour of the location, nestled between Poole and Bournemouth, that really gets people talking. It's the house prices.
The vertiginous hike in values began in 1991, given a helping hand by local estate agent Tom Doyle from Lloyds Property Group.
After selling a small flat for £1 million, Doyle worked out that the price per square foot made Sandbanks the fourth most expensive place to buy in the world, and he succeeded in getting it formally ranked on influential property listings. The rest is history.
So, when the credit crunch wreaked havoc on the UK property market, how did Sandbanks fare?
Did it, as the Sun sneeringly suggested, turn into Sandbankrupt? Or did the upmarket seaside bolthole float above the murky waters of recession?
Although not every estate agent on the peninsula will admit to prices having fallen, Adrian Dunford, owner of the Tailor Made estate agency, is willing to talk about the bad times.
"Yes, we were affected, in the sense that prices fell 15-20 per cent across the board. The bottom was September/October last year.
"The market that was decimated was the £1 to £2.5 million, the aspirational purchaser, someone who probably has a business that's doing well and wants to buy a second home.
"Those buyers would normally have put some money down, and got a mortgage for a million.
"When they disappeared there was a backlog of stock that we were unable to sell."
But if the economic downturn was bad news for most, for a few canny investors it meant time to go hunting for bargains.
"If a property was on at £800k we were seeing people starting bids at £500k, and every now and then they tripped across the odd owner that would accept 20 per cent below asking price.
"Investors were buying three or four at a time. One client came from abroad and bought three properties under a million from a builder off plan. It was a real bargain, but the builder still made a profit."
According to local estate agents, if you want to predict the market on Sandbanks, look at what's happening in the prime London sector, and make yourself a cup of tea. By the time you've finished, Sandbanks will be doing the same thing.
"We do follow London, and whereas we used to be six months of so behind, now it's all more immediate," says Keith Fensom from Savills' Canford Cliffs office.
As the majority of buyers come from London, there is an important knock on effect. "If the market's not moving in London it affects us."
While overseas investors rarely buy in Sandbanks – the properties are usually seen as too small – the recent influx of buyers snapping up London homes allowed the London sellers to come down to Sandbanks to spend their cash.
And, although prices remained low, the volume of sales began to rise in Sandbanks last December.
The Savills office had ten sales, a strong result, given the prices, even in a good market. And Adrian Dunford, from Tailor Made says that it was the busiest month on record for the eight years since the company began.
"It was actually my busiest December in the whole 23 years that I've been in the business," says Dunford.
There were two main reasons for the rush.
Firstly, fear of the banks. With the government's deposit protection limited to the first £35,000, buying property that risked a further ten per cent drop in house prices was the better option.
And secondly, people recognized bargains when they saw them, particularly British buyers who were living abroad and could benefit from the weak pound.
These factors continue to hold sway and by all accounts the market in Sandbanks is once again busy and prices are slowly on the up.
"It isn't back to where it was "06/"07," says Adrian Dunford. "But it's much better than '08. Last year people were worrying that prices would drop by 40 per cent, but people aren't saying that now.
"The expectation now is that offers will be closer to the asking price. Most people would accept maybe five per cent off.
"There are still a few good deals around, but they're starting to be harder to come by."
In fact, Paul Fisher from the Lloyds Property Group reports seeing some gazumping returning to the Sandbanks market.
The reason for the lack of bargains is partially down to the demographic of Sandbanks owners.
With 80-90 per cent being second homes, there are fewer people who are under pressure to sell, and the owners are usually happy to sit tight and wait until the market recovers.
But there are plenty of properties changing hands. "We've found the £500k to £1 million market strong," says Dunford. "And gradually we're seeing it bleeding through the rest of the market. We've got offers now on property at £3 million."
And the top end? Dunford says that although the multi-million pound properties epitomize this Dorset Monte Carlo, they are relatively rare.
"Historically in Sandbanks you may only sell properties above £5 or £6 million maybe four or five times a year. There are only 30 houses on the water and 30 with direct access to the peninsula."
But while Sandbanks is thriving, can the same be said for the rest of the locality? No, says Paul Fisher. And it's largely to do with credit.
"Here we have a lot of second and third homes," says Paul Fisher. "Our people might be putting 50 per cent down. They've probably got the rest of the cash, but they're getting finance for different reasons, and credit isn't so much of an issue."
"If you go into Bournemouth or Poole town centres 99 per cent of properties will need finance to be arranged." And that can be problematic at the moment.
"Also stocks here are low and that keeps prices high. It's a very unique, small area. You normally find someone who wants to purchase.
"And we don't have the enforced sales, it's not like people are moving because of jobs or being forced to move, it's a different market place."
But, says Keith Fensom from Savills, the Sandbanks market is more volatile than surrounding areas.
"When the market is strong prices rise rapidly but equally they drop fast."
Fensom points out that there are many other beautiful locations nearby, some of which come with a significantly lower price tag.
"There's Pool, Branksome Park, and Lilliput. And you can get a nice family house in Lower Parkstone, just a mile inland, for £500k to 1 million.
"Other than that Boscombe Manor is up and coming because of the artificial reef that's being built."