Confidence is returning to the country property market

The Home Counties lead the way as the prime country property market shows signs of recovery, says research from Knight Frank.

Knight Frank has released its Prime Country House Index Q2 2009. The key highlights are as follows:

• The average price for prime country properties in the Home Counties rose by 0.8 per cent in the second quarter of 2009.
• Overall, prices for prime country houses dropped on average by under one per cent, compared with a 4.7 per cent fall in Q1.
• Average prices have fallen by 17.5 per cent in the 12 months to the end of Q2, compared with a 20 per cent drop in the 12 months to the end of Q1.
• Across the UK, properties over £5 million showed the biggest average increase (2.2%).

Andrew Shirley, Knight Frank's head of rural property research, said: "Well-paid City workers now feel more secure in their jobs and sizeable bonuses already seem to be back on the agenda. This effect has quickly rippled out to the Home Counties, where many of those working in the financial and associated sectors live. Knight Frank sold more houses in June than in any month over the past three years and the number of new applicants registering with our offices increased by 15 per cent compared with June 2008. This helped push prices up by 0.8 per cent in the second quarter of the year."

However, he warned that "despite this more positive sentiment in some areas, it would be wrong to say the market is on its way to a full recovery. Prices in Scotland, for example, fell by 6.3 per cent in the second quarter, with values also showing significant declines in north-east England (-4 per cent) and north-west England (-3 per cent)."

Prime property performance by sector

Prime property performance (all types) by Knight Frank region