Sunday, 01 October 2017 20:24

Rural homes '20% more expensive'

Written by  Ruralcity Media
Rural homes '20% more expensive'

Buying a house in the countryside costs 20% than it does in a town or city, according to the latest figures.

Although a 'rural premium' exists across the country, rural homes are comparitively much more expensive in some areas than others, suggests the Halifax housing index.

The greatest difference is in the West Midlands where the average rural house price (£280,776) is 47% (£89,272) higher than in the region's urban areas (£191,504).

The smallest difference is in the East of England, where there average premium on countryside homes drops to £27,765 (or 9%).

    See also: Need rises for affordable rural homes

Property in rural areas is less affordable than in urban areas, with the property price in rural areas 7.6 times average annual earnings.

This compares to a ratio of 6.5 in urban areas.

All 10 of the least affordable rural local authority districts are in southern England, where North Dorset is the least affordable rural district with an average house price of £361,603.

This is 11.4 times local annual average earnings (£31,723).

The second least affordable area is Chichester with and average house price of £411,547 (10.8 times), followed by West Oxfordshire (9.9 times).

Most affordable

Those wishing to escape to the country on a more manageable budget should look to the most affordable rural districts in the north of England and Scotland.

Copeland and East Ayrshire are the most affordable rural districts in Britain, where the average house price is 4.1 times local average gross annual earnings. (See Tables 2 and 3)

Urban property values have risen more rapidly than rural over the past five years

Between 2012 and 2017, the average price of a countryside home rose by 31% compared with an average increase of 43% in urban areas, resulting in the urban-rural premium gap narrowing from 31% (or £47,769) in 2012 to 20% (£44,454) in 2017.

Despite this, the rate of growth for both urban and rural areas has been the same at 3% over the past year.

First-time buyers account for 41% of all mortgage financed purchases in rural areas, compared to 53% in urban areas, with affordability the main reason for the lower proportion of first-time buyers in the countryside.

Halifax mortgages director Richard Washington said: "Homeowners looking to escape to the country can expect to pay an average premium of 20% for a property.

'Out of reach'

"Housing affordability, particularly in the south of England, is putting a country home out of reach for many people, especially those looking to buy their first property.

"This is reflected in first-time buyers accounting for a smaller proportion of homebuyers in the countryside relative to urban areas."

The least affordable rural local authority districts outside the South and Eastern England are Malvern Hills (8.0) and South Northamptonshire (8.0) in the West and East Midlands.

Waverley in the South East is the most expensive rural area in Britain with an average house price of £487,824. This is followed by Sevenoaks (£453,458), South Oxfordshire (£434,544) and Uttlesford (£433,934).

The average house price in Waverley is more than three and a half times higher than in East Ayrshire in Scotland (£128,864) – the cheapest rural district in the country.

First-time buyers

Getting on the rural property ladder is at its most challenging for first-time buyers in southern England.

First-time buyers make just up a quarter of all purchases in the Cotswolds and East Devon and around a quarter in Chichester (26%) and Uttlesford (27%).

The proportion of first-time buyers is significantly higher in some areas outside the South.

They account for more than three out of five buyers in Forest Heath in Suffolk (64%) and over a half in Dumfries and Galloway (55%), Western Isles (55%) and Moray (53%).

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