For
a map of Britain's holiday home hotspots, click here - or click
here for a detailed breakdown of price changes
A decade or so ago, owning two cars was a sign you had made it. Today, it is
two homes. From Rock in Cornwall to Robin Hood’s Bay in North Yorkshire, and
Southwold in Suffolk to Snow-donia in north Wales, holiday homes have been
one the biggest beneficiaries of Britain’s housing boom, with prices in some
of the most beautiful – and accessible – spots rising by far more than in
the country as whole.
Estimates for just how many people own a place by the seaside or a bolt hole
in the countryside vary widely: the latest government figures put it at
240,000, but Savills estate agency estimates it could be as many as 365,000.
In north Cornwall, the hottest of holiday hot spots, prices in the five
areas with the highest levels of second-home ownership have risen by 351% in
the past 10 years, the agency says. Prices in the county as a whole have
grown by a more modest 253% in the same period.
With the broader housing market wobbling, where does this leave the
second-home sector? Will this be the year to snap up that bargain holiday
home? The answer, inevitably, depends on where you are looking and what you
want. “The top end is swimming along as usual,” says Lucian Cook, director
of research at Savills. “If there is a scarcity of houses, prices will
remain strong. The house that features on the postcards will always sell
well.”
In other words, if you think you will get that five-bedroom seafront villa in
the South Hams, Devon, or that period manor house in the Cotswolds for a
knockdown price, then think again. Look lower down the price scale, however,
and there may be some bargains out there. Although agencies in the most
popular holiday spots are not reporting forced sales, there are indications
that some potential buyers are doing their sums and holding back: with
credit tight and rising utility and council-tax bills cutting into
disposable income, a second mortgage is not top of everyone’s wish list at
present.
“The sub-£500,000 market could see lots more properties put up for sale as
buyers look to free up capital,” Cook says. “There will also be less
competition for such properties. It will be easier, but that doesn’t meant
to say it will be easy.”
The changes to capital gains tax due to come into force in April may also have
an impact – although this, too, is difficult to predict. The cut in the rate
from a maximum 40% to 18% levied on the profits from second-home sales could
persuade some owners to sell up and cash in their profits. And, provided
they satisfy certain criteria, those who rent out their homes will pay only
10% on the first £1m of gains, thanks to a U-turn, announced last month by
the chancellor of the exchequer, Alistair Darling.
So, whether you want a weekend bolt hole, a holiday home for the family by the
seaside or simply to try out country life on a part-time basis, here’s our
guide to what is happening to prices and what properties are on offer.
The southwest
The sandy beaches, rugged cliffs and top-notch sailing have long attracted
urbanites down the A303 (or, increasingly, into their private planes),
making the West Country one of the most desirable and expensive places to
buy a second home. That does not look likely to change much this year.
“Rock is as crazy as always, although people are spreading out towards Padstow
and Constantine,” says Sandy Davenport, head of the waterfront division of
Knight Frank in Exeter. “People are paying big prices. If you want to be on
the water anywhere on a Cornish estuary or the South Hams, you have to be
prepared to dig deep.”
However, her colleague, William Morrison, who heads the office, says the
market for properties below £600,000 is “stickier”. “It is a buyers’
market,” he says. “Six months ago, it wasn’t.” Dorset, with its
chocolate-box cottages and Miami-style pads along the seafront in Poole,
shows the same patchy performance across price brackets.
East Anglia
Second-home buyers have long been drawn to the Norfolk and Suffolk coast.
Holiday cottages are still in demand, and January saw record sales in some
spots. As with the property market as a whole, those who do not need to sell
are not putting their home on the market, and properties that are up for
sale are taking longer to go under offer.
In the Georgian hot spots of Southwold and Aldeburgh, you can buy a
fisherman’s cottage or 200-year-old three-bed house for £450,000 – about the
same price as they were last year, according to Adrian Smith, a director of
Jennie Jones estate agency in Southwold. Prices along the rugged north
Norfolk coast, from Cromer to Hunstanton, have also stabilised. “Prices went
up dramatically here over the past few years, but have slowed down a bit,”
says Philip Macdonald, managing director of Abbotts in Bury St Edmunds.
The south
Prices on the Isle of Wight, a half-hour ferry ride across the Solent and
Queen Victoria’s favoured location for a second home, are stable or falling.
“The days of ‘it’s worth £100,000, let’s try for £115,000’ are gone,” says
Greg Lewis, office manager of the Bem-bridge branch of Creasey Biles &
King. “Properties on for £600,000 last year will still be on for £600,000
now.”
Mark Astley, a partner with Jackson-Stops & Staff in Chichester, West
Sussex, where it is possible to pick up a cottage for £450,000 to £500,000,
says the market there is holding up – but sellers are having to be more
realistic. “If a house is priced sensibly, it stands as good a chance of
selling now as it did last year, but there is no room for overpricing,” he
says. “There are no great reductions, yet.”
The Cotswolds
Full of manor houses, picturesque villages and market towns, this swathe of
countryside stretching from Bath to Stratford-upon-Avon has become a prime
weekend destination for the smart set, and interest – for now, at least –
remains strong. “The number of inquiries is higher this year than last
year,” says Sam Butler, a partner at Butler Sherborn, a local agency. “That
said, there’s a lot of toe-dipping going on without a huge number of actual
sales. Prices are holding up, but everything takes longer.”
Ed Sugden, a director of Property Vision, a buying agency, nevertheless
believes the market for weekend cottages in the area has fallen flat: “Your
standard not-so-special village house has probably dropped 5% to 10%.”
The Lake District, Yorkshire Dales and Northumberland
The traditional spots of Windermere and Ambleside in the Lakes, and properties
in the national park, are behaving much as they always have done: rising
steadily and remaining relatively expensive compared to much of the local
housing stock. “We’re a long way from London,” says Nick Miller, managing
director of Eden estate agents in Penrith. “Prices have been steady since
2004. Buyers come from all over the country – I can’t see it changing.”
It is a similar story in Alnwick, Northumberland, and the towns of Scarborough
– Britain’s first seaside resort – Robin Hood’s Bay and Whitby, in North
Yorkshire. “There’s no evidence of a slowdown so far,” says Laura Noble, a
negotiator in the Whitby office of Reeds Rains. “Half-term has been busy,
and we have had lots of interest in the small cottages under £200,000 that
second-home owners look for.”
Up in the border town of Berwick-upon-Tweed, however, prices have taken a
knock. Andrew Aitchison, director of Michael Aitchison Property Services,
says anything above £250,000 has slowed dramatically. “The market for second
homes under £200,000 is still strong, but they are taking longer to sell.
People are pulling the purse strings in a bit.”
Wales
The principality gained a reputation for being a cheap Cornwall, until prices
took off dramatically five years ago. Pretty, period properties with sea
views in the Gower peninsula, northern Pembrokeshire, Ceredigion and the
northwest coast have all registered double-digit growth. But here, too,
things are starting to calm down.
“We had a phenomenal couple of years,” say Neil Evans, a director of West
Wales Properties in Haverford-west. “But now prices are beginning to flatten
out and in some cases fall. It’s likely to stay that way for most of the
year.”
Without a 'ladder of jobs, houses and affordability' the very rural idil that most people reading this dream of will die. I live in rural Suffolk and lived in Aldeburgh for 7 years. I have nothing against people who own property, but its a hard balancing act. Try visiting in January!
R, Nr Aldeburgh, England
Guess what Welsh/Aldeburg:
I have owned a home in the UK for 20 years. I pay over 1000 UKP annual tax on a walk-in terrace but do not use council services 3/4 of the year.
By the way, I have invested over 25,000 UKP in local goods and services - a nice contribution to the local economy aint it!
susan, southern california, usa
I;ve lived in Scotland for 12 years. I am not Scottish. I do wonder why articles are constantly labelled as British yet do not include any research or comment on Scotland and Northern Ireland.
If you only use the Land Register of England and Wales then label the articles accordingly.
Ian Glasgow, Glasgow., UK
In some areas of the country average income is quite high and housing costs are high. Obviously that causes a problem for people and housing forms a much bigger proportion of household expenditure than it did before the home ownership boom.
The real problem occurrs in areas where income is low and housing costs are high. Couple that with the lack of cheaper (i.e. rented) accommodation and the influx of people with greater spending power from higher income areas (to buy second homes or stay permanently, say as retirees), and locals (particularly younger people) have got a big problem.
In Newquay, where the block with 1 elderly resident featured in the newspapers is located, hotels are closing down and being converted into luxury blocks intended as second home/rental, which are too expensive for current residents and driving up general housing costs even more.
WST, Colchester,
My husband (a tradesman) and I own a second property, a detached cottage which is; hopefully our pension but also we spend all our free time there. We are not 'well heeled', in fact we were both brought up in council houses, and we are in our 40's, so not the stereotypical type that is always bandied about. We have scrimped and saved for our houses & we don't owe you a living 'D' from Aldeburgh, despite you being 'a middle class, professional' whatever that means!! By the way it is expensive everywhere not just where you live, wake up & smell the roses!
zoe, basingstoke, hants, UK
As one who lives in an area attractive to second-home owners I feel the pain of ordinary working people who can no longer afford to buy where they work and have family. Maybe the only solution is what Bermuda has done - the government builds houses to sell to locals at an affordable (though still very expensive in their case) price.
Bill Atkins, Rehoboth Beach, USA
I think the nail was struck firmly on the head when that story a couple of weeks ago about the lady who lived in the 14 flat residence on her own came out.
The whole apartment complex stood empty for 80% of the time. How can there be any local economy when nobody is living in these places?
I am extremely glad not to have been brought up in a place like Cornwall where any hopes of trying to get a house are dashed because some city boy has bought a place to live in at the weekends.
This article just adds fuel to the fire.
Jamie, Halifax, West Yorkshire
Well done again to yet another 'quality' newspaper for encouraging the second homes market. You can pat yourselves on the back for helping to contribute to the 15:1 ratio between average house prices and average income in Cornwall.
By the way, your map shows North Cornwall in Devon, Penwith where St. Austell should be. Not to mention the Isle of Purbeck, which is the sticky out bit to the right of where you have put it. Still, I suppose it doesn't matter as one's pilot will konw which airport to land at...
WST, Colchester,
"you can buy a fisherman’s cottage or 200-year-old three-bed house for £450,000"
and just think, you could rent your shed to a fisherman to pay the mortgage!
Steve, London,
"For a map of Britain's holiday hotspots click here.... and open up a map of England and Wales". Ever feel you've outstayed your welcome?
Fiona, Cairo, Egypt
Second homes should be treated as commercial property for council tax and services purposes as the italians have done for years.
Edward Welsh, Lampeter, Wales
Money, money , money!
Why can't a reasonably well paid, middle class, working professional afford to get on the housing ladder when one is lucky enough to have been born and raised in one of the aforementioned, 'Hotspots'?
The answer is plain and clear, holiday homes that either stand empty 9 months per annum, or are leased at vastly over-inflated prices to the well heeled push the price of these family homes out of reach of the very people they were built by and for.
D, Aldeburgh, Suffolk