According to Knight Frank’s Prime Country House Index Q1 2008, the annual rate of price growth in the country house sector has slowed to 4.5%, which is the lowest level since Q1 2006.

The sector showed negative house price growth for the second consecutive quarter, with prices falling 0.2% in the three months to the end of March. Prices in both the manor house and the country cottages markets fell for the second consecutive quarter by 0.4%. Farmhouses defied the negative rates of growth in the other two sectors in Q1 2008 with a quarterly increase of 0.3%, and an annual growth rate of 5.3%.

Liam Bailey, Knight Frank’s head of residential research, said: “ It is clear that the influence of the correction we first saw in the wider market towards the end of last year is now gently working its way through the country house sector.

“The weaker market conditions in 2008 mean that sales volumes are down sharply on 2007, we anticipate that sales across the market will be around 25% lower this year compared to their historic average. This points to the real need for those vendors who need to sell their property in a reasonable time frame making sure that their asking price is realistic and for most properties this means accepting a lower price now than you would have done six months ago.”