As more wealthy buyers look for alternatives to London’s high-priced properties, luxury prices in other key markets, especially those within commuting distance of the capital city, trended higher in the second quarter of 2017, according to Knight Frank reports released Monday.
Bristol, the country’s 12th largest metropolitan area, southwest of London, with a booming tourism industry, reported the strongest luxury price growth, at 7.4%, among the six prime markets tracked by Knight Frank in the second quarter.
Knight Frank didn’t release raw market data.
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The six key prime markets—Bath, Bristol, Cheltenham, Exeter, Oxford, and Winchester—are well connected to London by train or by road. The prime market is defined by Knight Frank as the top 5% to 10% of each city.
These prime markets benefited from a trend that started post-financial crisis, said Oliver Knight, an associate of Knight Frank and author of these reports. "People started moving out of London and into these cities."
As a result, "prime properties in these areas have outperformed the general market in the past few years in both price growth and activity level," he said.
Bristol’s robust price growth has been accompanied by an increase in activity at the higher-end market. There was a 16% increase in the number of residential transactions valued at £500,000 (US$658,000) or more in the 12 months to June, according to Land Registry data cited by Knight Frank.
More:A Four-Story Chelsea Fixer-Upper With a History of Colorful Inhabitants In Bath, a city favored by many overseas buyers for its good schools, transportation and amenities, prime property prices increased 4.7% year-over-year in the second quarter. Knight Frank data show that 15% of sales completed in Bath so far in 2017 were to overseas buyers, up significantly from last year.
Prime prices in Bath, averaging £400 to £500 per square foot, are attractive relative to other university towns such as Oxford and Winchester, according to the reports.
During the three-month period from June to August, 14% more new buyers registered with Knight Frank than the same period last year. Meanwhile, the number of viewings was 27% higher and sales were 42% higher over the same period.
Oxford had the slowest price growth of the six during the 12 months leading up to June, at 0.8%. Buyers in this market are noticeably more cautious, Knight Frank said. On average, listings stayed 28% longer on market from June to August, while supply was nearly one-third higher at the end of August compared to a year ago. Due to the stock pileup, vendors had to make price adjustments to meet buyers’ expectations.