End of working from home culls number of £1m houses

THE number of properties worth more than £1m has slumped as pandemic-era demand for rural homes slows.

There were 8.3pc (60,260) fewer properties worth at least £1m at the end of 2023 compared to the previous year, data show. The number fell in every British region last year, with the total now standing at 670,100. And 80pc of the decline occurred outside the capital, as white-collar workers tempted during Covid to swap their city townhouse for a rural retreat sold up, according to estate agents Savills.

East and South East England, Yorkshire and Humber and Wales saw the steepest falls of 13pc, while London saw the lowest drop of 4pc. Housing experts believe a boom in demand for country properties during the pandemic has started to reverse, causing prices to fall.

The mortgage crisis has also been a factor. Across Britain, property transactions were down 20pc last year compared with the year before, according to HM Revenue & Customs.

Lucian Cook, head of residential research at Savills, said: “The race for space from mid-2020 drove a sharp increase in the number of £1m homes outside of [cities]. However, increased mortgage costs and a rebalancing of demand back to city living meant about 30pc of those whose homes crossed the £1m threshold, have, for the time being at least, become aspiring million-pound homeowners once again.”

The reversal coincides with workers returning to the office. For the first time since the pandemic, more people are working in the office full time (43pc) than hybrid (39pc), with only 18pc fully remote, according to data from recruitment consultancy Hays.

Emma Fildes, a property adviser at Brick Weaver, said: “Employers are clawing back days in the office. Faced with long journey times and network rail delays, this has led to many questioning their move.”

There are still 52pc more £1m homes in London compared to 2019 and 28pc more across the UK. Ms Fildes added while properties at the £2m-mark have been hit hardest, homes costing around £1m also suffered from a “weird market” over the last two and a half years.

“Prices haven’t come down as far as where they were before the pandemic but they have reduced and nobody is quite sure how it settles. It’s a crazy time to be buying,” she said.