Even as the market slows, houses by the sea, rivers or lakes still command a premium. Are waterside properties actually recession-proof?
When James Sanchez and Annabelle Hillard were looking for their first home together, the monthly cost and length of commute were their first concerns.
Sanchez, 25, and Hillard, 26, could have bought a property close to their parents, who live in Milton Keynes and Surrey respectively.
But they fell in love with a lifestyle close to the Thames while house-sitting for a friend who lived in Wandsworth, southwest London. When shared ownership flats came up for sale opposite, they couldn’t resist and opted to buy a 25 per cent share in a one-bedroom property instead and pay rent on the rest to the housing association Peabody……
To live close to water — whether that’s a river, lake, estuary or the sea — you have to make financial sacrifices.
Despite the pandemic’s “escape to the country” trend fading, and the Bank of England stretching the nation’s purse strings by increasing the bank rate to 5 per cent last month, a waterfront home in the UK is still worth up to 48 per cent more than an equivalent non-waterside property.
Figures released this week by the estate agency Knight Frank show that these homes are much more resilient to the headwinds of the housing market than other properties.
The overall premium for a waterfront home is only two percentage points lower than a year ago, according to Knight Frank, a smaller fall than the national average of 3.5 per cent in Nationwide’s latest house price index, released this week.
Last year 57 per cent of waterside properties sold above asking price, according to the estate agency Jackson-Stops; only 27 per cent sold above asking in 2020. On average they sold for 4 per cent above the guide price, up from 1 per cent under asking price in the five years previously.
This could be because waterfront buyers tend to be more financially resilient than other buyers, with 54 per cent of them buying their property in cash in the past five years, compared with 29 per cent in the wider housing market.
They also tend to be older: data from the estate agency Savills shows that half of waterfront buyers in prime postcodes were over 50 years old (compared with 38 per cent in the wider market), and 26 per cent of them are buying a second home (compared with 6 per cent in the wider market).
However, fewer visits to the office each month mean that a life aquatic is more realistic for working-age buyers than it has ever been.
“Families are opting to bring their dream move forward by ten years to enjoy the benefits of the lifestyle, which is something I don’t see changing anytime soon,” says Sarah-Jane Bingham-Chick, partner at Knight Frank’s Exeter office…..
Coastal homes were the second most recession-proof waterfront properties — down from joint first position last year — commanding 66 per cent more than similar inland properties on average.
Carol Peett, a buying agent at West Wales Property Finders, http://www.westwalespropertyfinders.co.uk suspects this could be because of increased awareness of flood risks and soil erosion. “People want properties overlooking the water but well above the high-water mark, or in sheltered bays like Dale in Pembrokeshire, which are more desirable,” she said.
Dale is particularly popular with the sailing crowd, she explained, but Newport and Tenby are prime spots in Pembrokeshire, alongside Llansteffan and Laugharne in Carmarthenshire, and Tresaith and Llangrannog in Ceredigion.
The coastline along Cornwall, Devon and Dorset in the southwest of England is the most expensive in the country, Savills reports, with an average regional resale price for seaside properties of £452,000 (19.5 per cent higher than inland).
According to Jackson-Stops figures, properties near water in Cornwall cost £371,994 on average, compared with £336,938 inland, a premium of 10 per cent.
In Dorset, properties near water cost £428,451 on average, compared with £382,832 inland, a premium of 12 per cent…….
The Times – Friday, 7th July 2023 https://www.thetimes.co.uk/article/why-homes-by-the-water-defy-the-house-price-falls-53f6sg0nv
If you are looking for a waterside property in Pembrokeshire, Carmarthenshire or Ceredigion, give West Wales Property Finders a call on 01834 862816. We can find your perfect property for you whilst saving you stress, time, and often money too.