There is no such thing as a recession-proof town!

Last year, estate agents claimed property in certain towns in the UK were 'recession-proof, fail-safe investments'. Now that we appear to be nearing the bottom of the market, John Fitzsimons finds out: Were their claims right - or wrong?

There is no subject more emotive with your average Brit at the moment than house prices (well, besides the state of the Government, but that particular can of worms is probably best left alone for the time being).

For better or worse, we are an island that thrives on home ownership, one which has been known to define a person's status by the value of their home.

I can't imagine the Germans - historically a nation of renters - switching on for series after series of Location, Location, Location, for example. (Not to mention all the re-runs.)

So for many of us in the UK, when the credit crunch began to bite, our first worry was how the ensuing difficulties would impact house prices - and more specifically, the price of our own homes.

A list of house price havens

In a bid to allay these worries, in February last year, The Times and estate agent/mortgage broker Knight Frank compiled a list of the 20 best places in Britain to buy a home, irrespective of the credit crunch - in their own words, the "most fail-safe investment towns".

The research claimed that factors such as the affordability of the housing, wages and employment in the area, coupled with the qualifications of the locals, meant that these areas are recession-proof.

Since the data was released, house prices have fallen 16% on average across the country.

Now, with the first signs that we might, just might, have reached the bottom of the house price decline, let's have a look at just how 'fail-safe' buying in these towns really was!

First, a quick word on my methodology. In the name of consistency, I have used Land Registry data for the relevant towns to compare the average house price this year and last year, rather than comparing the initial figures from Knight Frank with the current figures from the Land Registry. It's just neater that way.

Prices down in 'safest' town

Unfortunately, the results are not all that promising.

Cambridge came top in the estate agent's initial list, with top marks in almost every area, thanks to high employment and wages, as well as restrictive planning laws scuppering the chances of a sudden boost to the supply of homes.

Despite this, however, prices in the city have plummetted almost 10% over the past year, to an average of £263,199.

Now a fall of 10% is far from the worst in the country, but equally it is not exactly what you would expect from a 'fail-safe investment', is it?

It could be worse

To be fair, a number of towns on the list have fared reasonably well in context.

While all towns suffered falls in house prices, some were relatively small. For example, Edinburgh, which was recommended as the seventh best place to buy, dropped of just 5.8% to an average of £201,021.

Similarly, York fell a little over 6% to £191,817, while Reading, Bristol, Norwich, Southampton, Telford and Bournemouth all 'enjoyed' house price falls of 10% or less.

The worst offenders

However, there are a fair few horror shows on the list as well.

If you bought in Brighton last year, motivated by the coastal views, and afternoons on the pier, then you probably don't care (too much) that prices fell a whopping 14.4%.

But if you were following the advice of this list, you might be a bit miffed.

Likewise, if you bought in Milton Keynes, you are currently counting the cost of the 15.1% drop in house prices in the region, taking the average house price to £167,788, or Portsmouth, which suffered a massive fall of more than 17%.

The worst offender though is Crawley, which had been recommended as the eleventh safest town to buy a home. Since then, prices have fallen by around 18%.

That's 2% more than the national average - so about as far from 'recession-proof' as you can get.

Indeed, according to the Land Registry, only a handful of areas, including Rutland (20.7%), Hartlepool (19.9%), and the Isle of Wight (18.7%) can match such a drastic fall.

Alternative 'recession-proof towns'?

Believe it or not, some towns have actually seen their properties increase in value over the past year.

Windsor and Maidenhead lead the way with an annual increase of 9%, followed by Pembrokeshire (5.8%), Torfaen (4.4%) Middlesbrough (2.7%) and Carmathenshire (0.3%), while Swansea, Merseyside, Bridgend, Conwy and Wiltshire have seen minimal falls.

Does this make them recession proof? Does it heck!

Quite frankly, the idea that a single town is in some way immune to the effects of a national - nay, global - recession is lunacy.

Towns will have their individual selling points, whether that be desirable schools, good transport links, or simply a high proportion of large salary earners.

But the determining factor in the value of a property will be the property itself. To rely entirely on its location as some form of insurance strikes me as simplistic and naive.

If the last year has taught us anything, it's that nothing - least of all property - is a fail-safe investment.

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