Has the country house price boom already hit its post-Covid peak?

The post-pandemic race for space has pushed price growth of the most expensive homes outside of the capital to its highest level in 11 years. But there are signs that the country house boom has now peaked and buyers are turning again to urban life, as price growth spikes in city locations.

From June to September, the price of “prime regional” homes jumped 2pc compared with the previous three months, according to Savills estate agents. This pushed annual growth to 8.8pc, the highest rate recorded since September 2010.

In the Cotswolds, the value of £2m-plus country houses rose 18.5pc year- on- year, taking prices 14.4pc higher than their 2007 peak.

Growth was steepest in the suburbs of cities, where prices climbed by 10.2pc year-on-year as buyers moved outwards with an eye on a future commute.

The “staycation” boom also meant that house prices in coastal hotspots continued to climb, recording annual growth of 14.8pc.

In Truro in Cornwall, Norwich in Norfolk and Exeter in Devon, year- onyear house price growth was 16.5pc, 15.8pc and 14.1pc, respectively.

But the data suggested the postlockdown trend towards countryside properties is starting to reverse. Inner commuter locations recorded the largest quarterly price growth of any area in the country.

Values rose 2.4pc in three months as workers returned to their offices after the success of the vaccine rollout and the easing of lockdown restrictions.

Frances Clacy, of Savills, said: “We’re now seeing renewed demand from those who want to be back ‘in the thick of it’, as well as being closer to transport links and their place of work.”

Cities are once again proving desirable for wealthy buyers. Oxford, Winchester, Bristol and Glasgow all matched or outperformed price growth of prime homes in their surrounding areas. In Oxford, prices jumped 1.3pc in the three months to September, compared with growth of just 0.1pc in the surrounding area.

A lack of supply is driving growth despite the disappearance of stamp duty holiday savings. But almost half of surveyed Savills agents expected the number of available homes to increase over the next three months. This is likely to cool the pace of growth.

“For now, we are in a purple patch, with an imbalance between supply and demand playing out particularly in established inner and outer commuter locations such as Weybridge, Sevenoaks and Winchester,” said Andrew Perratt, of Savills.