Taxing times for second-home owners are proving to be a boon for the UK’s luxury rural property market, with sales of homes over £750,000 rising by 7% in June compared to last year. This unexpected surge in activity comes as falling prices, combined with increased supply, create an attractive environment for genuine buyers after a protracted period of market doldrums.
The catalyst for this market shift is the decisive action taken by local authorities regarding council tax on second homes. Welsh councils now possess the power to quadruple taxes on holiday homes, while English councils can double these charges. This aggressive policy is directly prompting many second-home owners to divest their rural properties, thereby significantly increasing the available stock.
The supply side of the market has seen a dramatic increase, with country house listings up 9% in the second quarter compared to last year. This expanded inventory, alongside a general softening of prices, has fundamentally altered the dynamics between buyers and sellers. Market experts note that “strategic pricing has become crucial,” with correctly valued properties quickly attracting bids, while overpriced homes linger on the market.
Industry professionals are cautiously optimistic, suggesting that June’s strong sales figures point towards a sustainable market recovery rather than a temporary blip. Buyers now enjoy unprecedented negotiating leverage, a significant departure from the highly competitive landscape of the pandemic era. This level of buyer advantage has not been seen since the economic uncertainty of 2018, making it an opportune moment for those looking to purchase a country home.