©Alamy

The Shakespeare Hotel and other Elizabethan buildings in Stratford-upon-Avon

Stratford-upon-Avon is best known as the place where William Shakespeare was born and brought up some 400 years ago, but its housing market is characterised by a very modern problem: too few homes on sale to meet the demand from potential buyers.

This mismatch prevails not only in the town itself, which is 100 miles northwest of London and dominated by heritage attractions and the Royal Shakespeare Company’s theatres, but also in the surrounding Warwickshire countryside, a swathe of central England designated as an Area of Outstanding Natural Beauty.

“I have several buyers with £1m to £4m to spend but there’s so little stock for them to view,” says George Barkes, who works as the Stratford and Warwickshire buying agent for Stacks Property Search.

This property scarcity is partly due to the size of the town relative to its reputation. Stratford has just 30,000 residents yet boasts an annual tourist count of three million visitors, almost all drawn by its Shakespearean heritage. A town with over 800 years of history, it has more than its fair share of attractive medieval buildings, mostly black and white half-timbered, lining roads in the centre.

Therein lies the problem: these properties are typically small, have a protected status that prevents expansion, possess modest or no gardens and are often located in narrow streets. As a result only a small minority are substantial family houses with grounds.

“Most of my clients want the indoor and outdoor space found in rural Warwickshire. They then use Stratford-upon-Avon as the nearest major spot for shopping and of course culture,” says Barkes. Country living is not difficult in this part of England, and local agents say professionals working some or all of their week from home have become a major force in the market recently.

Train and car journeys from Stratford to London both take around 90 minutes, slightly too long for most daily commuters to contemplate but acceptable to those visiting the capital only occasionally. As a result, the villages in the area are not “dormitory locations” and have good shops and pubs. Local schools, notably The Croft private preparatory and King Edward VI state grammar (both inside the Stratford boundaries) serve as magnets for parents demanding the best education for their children.

Barkes’ clients fall into two categories: “The younger families moving from London want a few acres of land to ensure privacy, plus close access to the M40 motorway. Then there are British expats, returning to England after working overseas, who believe now is the time for good value. In principle they’re right, but there’s little stock around,” he says.

©James Kerr

Netherstead Hall in Morton Bagot, on sale for £3.1m

The few top-end properties on sale now include Three Gates House, a 1930s Arts and Crafts-style home set in 36 acres of land at Moreton Morrell, a village seven miles from Stratford-upon-Avon. It is selling for £2.75m. Netherstead Hall at Morton Bagot, 10 miles from Stratford, is a Grade II-listed moated manor that has been recently restored and has an asking price of £3.1m (both at Knight Frank).

However, some agents suggest more buyers are now moving from the Warwickshire countryside to urban areas, with Stratford and nearby small town Royal Leamington Spa being the main beneficiaries.

“We noticed last year that some people were moving to townhouses so as to have a shorter school run,” says Rupert Wakley of the Stratford office of Knight Frank. His branch saw an 80 per cent rise in enquiries from cash buyers for this type of property in 2011, suggesting townhouses are popular with down-sizing retirees too.

He highlights Maidenhead Road and Tiddington Road just north of Stratford town centre, and Banbury Road just to the east, as examples of roads that have seen recent buyers paying £1m or more for the largest homes. “Prices in these locations have definitely held their value in recent years despite the broad economic downturn,” Wakley says.

This contrasts with the mainstream market in the town. Although values remain high by the standards of this region of England – a typical home costs £279,500, twice as much as nearby Nuneaton and some 40 per cent above the national average – prices within Stratford have nonetheless fallen 4.6 per cent in the past year according to the Land Registry, which monitors all house transactions.

Yet confidence remains strong at the top end of the market, as shown by the decision of Sotheby’s International Realty to open an office in the town. The agency, which has hitherto restricted its British branches to central London and affluent parts of southern England, is using staff who have defected from three rival firms.

“Our expansion will ensure we have a diverse range of real estate to present to our global database of clients,” says Sotheby’s UK managing director Charles Smith. He says the local area will be a draw to foreign buyers, thanks to the Shakespeare connection.

The new entrant may find itself busier than anticipated, thanks to a recent decision by the UK government to fund a £33bn high-speed rail network, known as HS2.

The first phase of the network, scheduled to take 14 years to complete, will run from central London to Birmingham. Its likely route will be through an area of countryside about 30 miles to the east of Stratford-upon-Avon. The consequence, some agents predict, will be a surge in demand for undisturbed areas.

“There will be years of disruption and the countryside will be dug up east of the M40. So demand for homes will drop there and will rise to the west of the M40 where Stratford is located. The town has already seen a lot of new homes in recent years and it may have more still, thanks to HS2,” says Stacks Property Search’s George Barkes.

Now the local council is to review its housing land provision and residents for and against new homes will have a chance to voice their opinions later this year. The eventual blueprint will have to include an explanation of how Stratford and its environs will balance heritage with the demands of a growing population.

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Buying guide

Pros

● Excellent road and rail links to London, Birmingham, Manchester and Bristol, and by air from Birmingham International airport

● No shortage of culture … so long as you like Shakespeare

● There are many period homes in Stratford, some close to open countryside beyond

Cons

● A large number of older homes are listed so cannot be extended easily

● Year-round high number of tourists in central Stratford and along the river

● Parking is very difficult and expensive in the town centre.

What you can buy for …

£100,000 A one-bedroom retirement apartment in a purpose-built complex near Stratford town centre

£1m A modern five-bedroom, three-bathroom detached house in a nearby village, with a garage and large garden

Contacts

● Stacks Property Search, www.stacks.co.uk

● Knight Frank, www.knightfrank.com

● Sotheby’s Realty, www.sothebysrealty.com