The country house market did well last year with prices for the average manor house increasing by £300,000.

Prices were up by 11.2% across the UK. The strongest performing sector was the manor house category – larger houses with land – which saw upwards of 11.9% growth over the year.

Knight Frank’s head of residential research, Liam Bailey, commented: “With the city economy performing well and the prime Central London housing market going from strength to strength, London buyers have taken advantage of continued high price growth and have taken their money out to the country.”

“The strength of demand over the past 12 months price growth in the country market rise to its highest level since mid 2004.”

Prices for all property types rose over the final three months of 2006 – country cottages (average price £530,000) were up by 1.9% farmhouses (average price £1,240,000) up 1.7% and manor houses (average price £2,940,000) have increased by 0.5%. This growth is equivalent to the average price of country cottages, farmhouses and manor houses growing respectively by £3,591, £9,580 and £26,358 each month in the year to December.

Liam Bailey said: “This strong performance of the prime country house market, especially in the South of England, is being driven by both the health of the service sector economy, and importantly the booming financial industries based in the City and Canary Wharf; as well as the shortage of supply that has become critical in many markets across the UK.”

“This strong performance emerged in October 2005, fuelled by then record-breaking city bonuses, and has continued to the present day. The same phenomenon is expected this year as we move into the 2007 bonus round, with both bonuses and demand expected to be higher than last year. These expectations, coupled with current stock levels being at a lower level than the previous year, means we can only expect strong performance in the market in the first half of 2007.”