An established market for UK and international buyers, Surrey marries proximity to London with access to natural beauty.
Foreword
"Buyers' priorities have undoubtedly evolved over recent years, but what has become increasingly clear is that many of the changes we first saw during the pandemic have become enduring trends rather than short-term shifts. Today's purchasers are placing greater emphasis on quality of life, flexibility and long-term suitability. Surrey continues to offer a compelling combination of attributes that meet those needs.
What stands out most in the current market is the depth and diversity of demand. While Surrey has always benefited from its proximity to London, we are increasingly seeing buyers choosing to remain within the county, moving to different locations or property types as their circumstances change. This reflects the strength of Surrey's established communities, schools, amenities and employment hubs, as well as the confidence many buyers have in the county's long-term appeal.
From the private estates and internationally recognised addresses of North Surrey to the villages, country houses and landscapes in the south, the county offers a breadth of lifestyle choice that few UK locations can match. For many buyers, the decision is no longer driven solely by commuting requirements but by a desire to strike the right balance between work, family life, leisure and access to open space.
Whilst economic uncertainty continues to influence decision-making, committed buyers remain active and discerning. Well-positioned, high-quality homes continue to attract strong interest, particularly where they offer something genuinely distinctive. Looking ahead, Surrey remains exceptionally well placed to benefit from those buyers seeking both lifestyle and long-term value, reinforcing its position as one of the UK's most desirable residential markets."
Research view
Surrey's enduring appeal in a changing market
North Surrey holds a prestigious reputation and can be characterised by its private estates, namely St. George’s Hill, Burwood Park and Wentworth Estate. Whilst South Surrey offers a range of country houses and provides access to a recognised National Landscape, the Surrey Hills.
Peppered throughout the county are also numerous unspoilt areas, such as Wisley and Ockham Commons, Bookham Commons and Puttenham Commons, offering expanses of green space and a desired escape from urban life.
Over the course of the pandemic, the prime housing markets of Surrey benefitted from an increased flow of London movers and local upsizers.
With buyers preferring larger properties and outdoor areas, many favoured the relative value Surrey had to offer, whilst retaining links to the capital. As a result, the £2 million-plus market experienced significant price growth, with values increasing by 18% over the two and a half year period from March 2020.
However, after Liz Truss’ mini-budget in September 2022, and the economic disruption that followed, prime prices have since fallen by -15%. This has led to net price growth of only 0.8% over the past six years.
More recently, the conflict in the Middle East has resulted in knock on effects on both the UK and global economies, as uncertainty has caused inflation and mortgage rates to increase. Although this has dampened buyer sentiment; net agreed sales above £2 million were up 4% annually in May according to TwentyCi, as committed buyers remain keen to transact. However, sales remain well below levels seen throughout 2022.
Value comparisons
The variety on offer across Surrey can be distinguished by hotspots in the North and South of the county.
North Surrey’s aforementioned private estates, gated communities and new builds offer exclusivity to buyers willing to purchase at a premium to the wider county. Local private members clubs include Beaverbrook, Wentworth Golf Club and West Surrey Golf Club; proximity to such amenities creates substantial appeal to buyers. As a result, detached houses in the renowned hotspots of Virginia Water, Esher and Oxshott frequently command in excess of £2 million.
By comparison, South Surrey typically offers better value, with a greater number of rural, country houses. Given Surrey’s myriad of highly regarded state and private schools, catering across all age ranges, sought-after locations, including Chiddingfold, Guildford and Farnham, are popular destinations for families.
For buyers looking to take full advantage of the Surrey Hills, with access directly on their doorsteps, there is a 56% price premium for properties which fall within the National Landscape, compared to the wider county.
Detached houses in the renowned hotspots of Virginia Water, Esher and Oxshott frequently command in excess of £2 million.
Neena Heeramun, Analyst, Savills Research
Buyer profiles for the £2m+ market
Home to some of the most notable markets within London’s commuter belt, Surrey continues to appeal to buyers moving within the county and from further afield. Given its proximity to the capital, in North Surrey, approximately one third of buyers come from London, compared to a quarter in South Surrey.
Furthermore, whilst in North Surrey the majority of buyers work in financial and professional industries (63%), there is more variation in occupation amongst South Surrey buyers who work in financial, professional, art and leisure sectors.
Given its proximity to the capital, in North Surrey, approximately one third of buyers come from London, compared to a quarter in South Surrey.
Neena Heeramun, Analyst, Savills Research
Younger, needs-based upsizers are also drawn to Surrey, attracted by the balanced lifestyle and good schools. In the market above £2 million, buyers below the age of 40 account for one fifth of sales, and two thirds are upsizers.
Surrey also continues to maintain its international appeal, with easy access to major London airports as well as Fairoaks Airport, Redhill Aerodrome and Farnborough Airport, reserved for private charters and helicopters. As a result, buyers from overseas account for a quarter of sales in North Surrey, and 10% in the south of the county.
Outlook
Looking ahead, we expect demand to remain relatively subdued as buyers continue to exercise caution, following the conflict in the Middle East and domestic political uncertainty. However, in the short term, committed buyers will likely continue to take advantage of reduced competition and the value on offer. This means it is more important than ever for sellers to remain realistic on their price expectations.
Given Surrey’s proximity to London and buyers’ greater propensity to use debt, we expect weaker wealth flows from the capital and increased borrowing costs to temper price growth over the rest of the year. However, as best in class properties continue to outperform the wider market, we expect the highest quality properties to attract the strongest levels of demand.
Over the longer term, an improving economic outlook and market sentiment will result in a gradual recovery in values. As a result, we are forecasting price growth across all prime regional markets to total +14.6% over the five years to 2030.