Savills Research | The Residential Property Focus May 2009
Prime markets
Spotlight on second homes
Research illustrates price falls in the most desirable second home locations
have, for the most part, remained in line with prime residential property.
A
lthough second home ownership most affected. Locations within striking homes have been rare, so transactions
levels increased by 2.6% across distance of London providing weekend, as have been the main casualty.
the country in 2008, the average opposed to holiday, accommodation have Many of the most prestigious locations
levels of second home ownership witnessed smaller falls. are exposed to the potential of forced
in the top 10 areas fell by just over 6%. Given the highly discretionary nature sales. Some families have relocated to
The common perception is that areas of demand, and the very high premiums their former second home when facing
such as South Devon, North Cornwall, paid for some second homes, the extent financial stress. The ability to commute
North Norfolk and the Suffolk Coast where of price falls in this market may have been and opportunities for home working have
there are high levels of second home expected to be higher. played an important part in this trend. n
ownership, have all been particularly However, part of this is reflected by
exposed to the current downturn. However, the fact that debt-related sales of second
our research findings largely contradict this.
In the 10 local authorities with
the highest concentrations of second
homes outside of London, second home
Second
Second Regional
Homes movement
ownership levels vary between one in 10
and one in 16 dwellings. Homes
Market since peak
Devon -14.7%
nwall -15.1%
Locations within striking
Markets
Cor
How price falls differ
Sandbanks / Canford Cliffs -15.4%
distance of London
from region to region Cotswolds -14.9%
providing weekend,
Dorset -16.6%
as opposed to holiday,
Scotland* -14.2%
Norfolk -14.0%
accommodation, have
Suffolk -11.0%
witnessed smaller falls.
* East Lothian and Fife eg. St Andrews, Level, Gullane
Source: Savills
In the areas with highest levels of
second home ownership, such as
Salcombe and East Portlemouth in the
South Hams and Padstow, St Meryn and St
Minver in North Cornwall, rates often run at
30% to 40%. Second home prices in these
areas average 50% to 60% more than the
local authority in which they sit.
Our research indicates value falls of
prime second homes averaged -18% to the
end of March. This figure is in line with the
average for prime regional property.
Geographical differences
This statistic hides the significant difference
between the least and most affected
properties. The most-affected quartile fell
by -25.4%, while the least affected quartile
saw values fall by just -11.9%. This reflects
the difference between properties in prime
settings, best suited to second home
demand and those in weak markets that
have now become reliant on local demand.
There are also geographical differences.
In Devon and Cornwall prices have been
12 savills
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