While central London’s high-end housing market was hit hard by uncertainty in the run up to the Brexit vote, other U.K. cities have fared much better.
According to Knight Frank, Bath, Bristol and Cheltenham are continuing to see price increases as demand outstrips supply. Reportedly the cities have weathered the impact of a 3% additional stamp duty as well as the pre- and post-referendum results.
New figures released Friday from the global real estate consultancy showed that annual house price growth for prime properties in the second quarter in Cheltenham, famous for its eponymous horse race, was 8.6%, while in Bristol it was 7.4% and 4.8% in Bath.
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This compares to an annual growth rate of 1.3% over the same time for the wider prime market in the U.K., where political and economic uncertainty ahead of the E.U. Referendum and the introduction of higher rates of stamp duty for second home buyers and investors kept a lid on growth in the first half of 2016.
According to Oliver Knight, an associate at Knight Frank Research, demand is coming from some Londoners who are looking for more space for less money in cities like Bath, Cheltenham and Bristol.
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"Londoners, who may be seeking more space and a balance between city and country life, are able to take advantage of the price differential between property values in the capital and those elsewhere in the country. This means those selling a property in London for one in a different town or city will get more bricks and mortar for their money," Mr. Knight said.
Friday’s report followed another recent report, also by Knight Frank, which showed the impact the Brexit had on the housing market. Annual price growth in prime central London fell 1.5% in July, and while this was the biggest drop since October 2009, the headline figure masked even bigger falls in certain neighborhoods within London.
For instance, with a fall of 7.3%, Knightsbridge, home of the famous Harrods department store, witnessed the biggest price drop in prime central London over the last 12 months. This was the largest decline in Knightsbridge in seven years. Chelsea and South Kensington, with drops of 7.2% and 5.7% respectively, followed.