Rural homes near London see price rise

PRIME country properties around London saw prices rising by 0.7 per cent in the second quarter of 2009 after five consecutive quarters of falls, according to the Knight Frank/ City PM prime commuter property price index.

For the UK as a whole, the average value of prime country property fell by 0.9 per cent over the same period, taking the index’s annual decline to 17.4 per cent.

Andrew Shirley, head of rural property research at Knight Frank said that although the London property market looked like it could be the hardest hit in the wake of the financial crisis, the increase in prices for central London prime property “has now started to ripple out into the Home Counties where many City workers live and where there are not enough houses on the market to satisfy the renewed demand.”

The increase was particularly pronounced in Cobham in Surrey, which saw prime property prices jump by 1.4 per cent in the second quarter. Nearby Esher saw a 0.9 per cent rise.

Home Counties properties in the £2-3m bracket – one of the hardest hit price brackets – saw the greatest quarterly increase of 1.8 per cent while prices of super prime properties of £5m-plus increased by 1.7 per cent.

As an investment, prime commuter properties in the Home Counties have still outperformed the FTSE 100.