St George’s Hill: the property bellwether for the global economy

Geoff Kaye is nothing if not assiduous in his work. The project manager for Wilton House, a gleaming, newly constructed mansion in south-east England, will shortly don his swimming trunks and personally test out every shower in the home, checking for temperature and flow controls as well as ease of draining. “I’ve already done it once but I want to go around again to make sure,” he says.

Plumbing is not the only mechanical feature to keep him busy in this ultra high-spec property built by UK developer Redridge, which comes with sauna, steam room and indoor swimming pool, lift, games and cinema room, automatic entrance gates and an underground garage with space for a dozen cars and a vehicle turntable. Festooned with electronic panels and pipework, the boiler room looks more like an industrial control centre than a domestic utility room.

Yet in spite of its profusion of swanky property “toys” and £11m price tag, Wilton House is unlikely to raise eyebrows among the locals. That is because it is situated in St George’s Hill, a long-established private estate of luxury homes in Weybridge, Surrey, the affluent county south-west of London. In this leafy, manicured environment, deep pockets are the norm and it takes something truly unusual to impress the neighbours. As pressure has come to bear on the top end of the property market, this enclave of big money and big houses has also become a bellwether for the fortunes of the internationally wealthy, as well as for subtle shifts in the way people buy, sell and build their homes.

When the builder and entrepreneur WG Tarrant bought up 964 acres of land here in 1911, St George’s Hill was wild scrubland. Tarrant was a champion of arts and crafts styling, and the homes he marketed to London’s merchants and financiers harked back to a pre-Victorian era of rural imagination, featuring mullioned windows and leaded lights, oak beams and clay roof tiles. Though many have since been razed or gutted by developers to make way for neoclassical or contemporary buildings, they are still visible peppered throughout the estate, a reminder of its Edwardian and interwar heyday.

Today, the estate’s 440 homes are sequestered among pine trees and towering walls of rhododendrons, as well as a lawn tennis club and a notable golf course. The residents’ association owns the roads and verges, and ensures their tranquility with ubiquitous speed bumps and a prohibition on builders or tradespeople arriving before 8am or parking anywhere but on the owners’ land.

Security guards in peaked caps monitor comings and goings at five access points, giving comfort to the Russians, Chinese, Nigerians and other wealthy families who have converged here in the past decade. “Exclusivity, security and proximity to London” are the chief attractions for those who can afford to pay between £3m and £20m to live here, according to Simon Ashwell, head of the Weybridge office of estate agent Savills.

It has had more than its share of celebrity residents, from Beatles John Lennon and Ringo Starr and Ronnie Wood of The Rolling Stones to racing driver Jenson Button and actor Kate Winslet. It attracted attention of a less welcome kind in 2012 when a Russian resident, Alexander Perepilichny, collapsed and died in unexplained circumstances while jogging near his St George’s Hill home, prompting allegations that he had been murdered by agents of the Russian state.

A Russian element has come through again, but it’s not as strong as it used to be

As a property market, St George’s Hill therefore has more in common with Mayfair in prime central London than with the rest of Surrey. Though it is a microcosm for the super-wealthy, its tightly controlled boundaries have proved just as vulnerable to the uncertainties roiling the global economy. Prices in London’s prime property market began to fall about three years ago and, according to figures in July from estate agents Knight Frank, are still edging down. The slowdown has expressed itself not only in falling prices but a retreat in transaction numbers, as residents decide to stay put and the flow of global incomers has slowed. In a good year, as between 2011 and 2014 when foreign money was flooding into the UK, there might be 35 houses sold in St George’s Hill. Last year, that fell to a dozen or so. “The market is pretty black and white out there at the moment. It is soft,” says Tim Garbett, a partner in Knight Frank’s Weybridge office.

As the pace of international buying has slowed, the mix of incomers has changed. Oligarch buyers from the former Soviet Union have been less in evidence since the rouble fell four years ago and the recent downturn in Russia’s relations with the west. Estate agents say professional Russian families of more modest means are still arriving in smaller numbers, while new nationalities have taken up some, but by no means all, of the slack. “A Russian element has come through again, but it’s not as strong as it used to be. Chinese and Malaysian buyers are my strongest contenders here at the moment,” says Garbett.

One indicator of the slower pace of the market is a rise in the number of long lettings. In a thin market where homes take longer to sell, owners can choose to let a property for two or three years in the hope of a later recovery. “You can lock it away and wait to see how the market is in a few years’ time,” says Ashwell. Otherwise owners face cutting the price or waiting for the right buyer, he adds.

One of the traits of today’s St George’s Hill buyer — even in hard times — is their willingness to start with a clean slate. Building bespoke, however, not only tends to raise costs but can leave owners of the most idiosyncratic homes attracting a smaller number of willing buyers and a cut in asking price when the time comes to sell. This might not worry the small category of buyers for whom money is no object, but even the wealthy are averse to losing money on a transaction.

When the FT visits, Ashwell opens the door to a relatively modest Tarrant house, built in the 1920s, with casement windows, and oak staircase and panelling in the hall. It is an example of the classic Edwardian design, where the ground floor contains a big dining room and separate drawing room, a tiny kitchen and, sometimes, a study. Upstairs are numerous bedrooms — and often an upstairs drawing room — to accommodate large numbers of offspring, with attic rooms for the maid and a nursery.

At the time they were built, such homes were tapping into nostalgia for an imagined past of countryside cosiness, where owners could have the feel of cottage living on a bigger scale. “But they are utterly unsuited to the way we live today,” says Ashwell, who predicts a buyer of this £3.95m home would probably demolish the lot and start again. “It’s all going to go,” he says. “This is a building plot.”

Sellers are trying to appeal to a market that only wants bespoke. Therein lies the problem

The characteristics of buildings that have replaced the original St George’s Hill homes have shifted over the past decade. Tim Banks, chief executive of developer Octagon, says that during the boom years his company was building almost nothing but speculative properties in St George’s Hill: it would buy a plot of land and construct a home of its own design and specification to sell to the buyers queueing up to come to the estate. At the time, the typical buyer was uncomfortable with the idea of dictating their own design; now, he says, they want homes tailor-made to their own tastes and needs. “The fear factor of getting your own house built has gone,” he says.

Ten years ago, new money was looking for size and glitz; developers were asked to build bigger and bigger homes, with little regard for the cost of running them. Now, says Banks, the drive to own a trophy asset has given way to a greater concern with the functions of a comfortable home, as well as sophisticated monitoring systems. With most St George’s Hill residents likely to be second or multiple homeowners and those at the top end circulating between several properties around the world, many of the biggest homes may be left empty for weeks or months at a stretch. Owners are therefore taking advantage of new technologies that allow them to control many aspects of their home from abroad, from heating and lighting to camera views. Smart fire security systems allow extinguishers automatically to detect and douse the source of a fire, rather than soak the contents of the entire property with a sprinkler system. Ultrasonic alarm systems on the property’s boundaries are another common request, but Banks also detects a more responsible attitude towards the environment, even among those with the deepest pockets. “We’re putting up Tesla battery packs and solar panels not because of compliance but because they’re being requested,” he says.

But if swimming pools, spas and tennis courts come as standard, what marks out one home from another? For Banks, the most memorable request came from a buyer who wanted a luxury dog kennel, built like a small house with a front door that pampered canines could push open at will, wired with electricity for heating and light. “I wish I was a dog,” he says.

The trend for bespoke design, however, can create problems that emerge only later on, when an owner decides to put their home on the market, says Henry Pryor, an independent buying agent. “Owners end up with exactly what they want, but eventually there comes a time when you have to break it to them that this isn’t necessarily what everyone else wants. They’re trying to appeal to a market that only wants bespoke. Therein lies the problem and an awful lot of new money struggles to understand and adjust to it.” Pryor advises his clients to stay away from top-end private estates, believing them to be overvalued. “St George’s Hill is one of the most visible examples of a market that’s got massively ahead of itself.”

In the wider Weybridge market, for houses of, say, £1.5m or less, Ashwell says much of his job is “educating people” that price growth in the UK market can no longer be taken for granted. Since many of the current generation of homeowners have never known anything but surging prices, this realisation can be painful, he says. The role of the estate agent can be a particularly unwelcome one, he adds, recalling a conversation with a psychologist who argued the agent’s basic task of valuing a home requires sensitivity, since it judges the visible symbols of a person’s financial success. “That’s your home, your retreat, you’re the king of that castle. Then some bloke in a shiny suit comes along and says, ‘You know, I don’t think you’ve done quite as well as you think you’ve done.’ And that’s a bit of a shock to people.” In a sluggish market, being the second estate agent to be instructed can be preferable, since it is the first who is required to put the client through this disagreeable learning process.

For the mid-priced home, the softening of prices has also permitted the re-emergence of one buying segment that Ashwell says had been in abeyance during the years of growth and fast-flowing overseas cash: the domestic British buyer with more limited resources. As the price of land plots or homes on the estate has ebbed, some domestic buyers formerly priced out of the market are finding themselves within touching distance of a home.

If they succeed, however, they might think twice before opting to impose their personality too deeply on their new home. The FT, for instance, notes the uncompromising purple faux-crocodile skin wallpaper that graces a property currently on the market for just under £5m. In its defence, Ashwell says the owners, a younger English couple, were aiming for a distinctive feel. “This is a party house. They had fun in here.” Now it has been on the market for five months, the hangover appears to be kicking in.