Spa towns energise market

Investors taking the plunge into British spa towns are enjoying healthy benefits. According to the latest research by Lloyds TSB, owners of homes in spa towns across England and Wales have seen property values rise by an average of 88 per cent over the past decade, equivalent to a monthly increase of £1,077 (HK$13,200) or 0.5 per cent.

The research found that these consistent price hikes are not deterring buyers, who are prepared to pay an average of £50,000 more for the privilege of living in a spa town.

Suren Thiru, housing economist at Lloyds TSB, says the lure is just too appealing. "Homes in spa towns continue to command a substantial premium over their neighbouring areas, with the quality-of-life benefits and sense of history that typically characterise such locations still resonating among homebuyers."

The attraction dates back centuries when well-heeled visitors would flock to bathe in the therapeutic mineral springs, seeking medical cures. "Taking the waters" was a popular pastime for Londoners during Georgian times, while it became the height of fashion to affluent Victorians. The spa towns, especially Bath, evolved into the playgrounds of high society, characterised by their grand, stately homes, sculptured parklands and community gathering places.

Lucian Cook, director of residential research at Savills in London, agrees that the appeal of spa towns is reflected in rising property values. He cites Land Registry data that shows house prices in Bath carry "a strong premium" of 52 per cent over Somerset as a whole.

"We think transactions are a good indicator of the strength of the market. On this measure, the Bath market has been relatively robust and is the strongest performer in the southwest of England," Cook says.

He says the performance of Britain's spa towns reflects the quality of housing stock and the living environment they afford, given their affluent history and retention of a strong character largely undiluted by modern development.