Second home sales boom
THE booming second homes market – said to have blighted Westcountry communities – has returned as figures revealed around half of the most desirable homes in Cornwall are being snapped up by outsiders.
The trend, identified by upmarket estate agent Savills, is the result of the revival of big City bonuses and poor returns from other investments.
The firm claims a thumping 43 per cent of "prime stock" bought in Cornwall over the last four years was as a second home, leading one Westcountry MP to claim it was making the region's affordable housing crisis even worse.
Demand for the most expensive residential property in the county, invariably close to water, comfortably outstrips that found in all other locations popular for second homes, Savills research claims.
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Underlining the Westcountry's status as a holiday home hot spot, Somerset recorded the third highest proportion in the same period, with 24 per cent of upmarket purchases made by second homes buyers.
With 20 per cent of properties bought as a second home, Devon trailed slightly.
The research – which characterises "prime stock" as the top 5 per cent to 10 per cent of homes in a local market by price, location and architecture – also showed the fall in prices at the top-end was reversing.
In the last year, prime properties in Cornwall shot up in value by 16.6 per cent – growth that outstrips Devon, Suffolk and the millionaire's row on the Sandbanks peninsula near Poole, Dorset.
In Devon, prices have risen 10.9 per cent in the last 12 months.
The average price sold by Savills' office in Cornwall is £1 million. Meanwhile, its Exeter outpost boasts "far more" buyers hunting for second homes with a £2 million price tag than buyers looking for more modestly priced homes to live in.
Savills research also suggests its market is returning to something close to its peak. It says prices in Cornwall are just 8.5 per cent off their highest watermark in 2007. But Devon, by contrast, is 17.3 per cent short.
Jonathan Cunliffe, head of Savills in Cornwall, said: "The people spending £5 million on a main home in London are often the very same people who are buying a £1 million house by the beach in Cornwall. The last quarter of 2009 was particularly strong, and perhaps this reflected a rising stock market."
Dan Rogerson, Liberal Democrat MP for North Cornwall, who has campaigned for a cap on second home ownership to be made law, said the top end did not exist in isolation from the rest of the market – arguing rising £1 million-plus properties ultimately dragged up the price of middle and low cost housing.
He said: "This comes as no surprise to those in Cornwall who are struggling to get on the housing ladder, to keep families together and to keep rural communities alive."