The planned South West Rugby development may not be building within Dunchurch itself, but its scale and proximity means the village and other nearby communities are watching closely.
The development of land to the south west of Rugby is expected to deliver around 4,000 new homes (in addition to those recently built at Ashlawn Road and Coventry Road), alongside schools, green space and supporting infrastructure over a long-term build project running into the 2030s. As proposals progress, questions remain about how the scheme could affect surrounding villages, including Dunchurch, and the impact on local property values.
Current house prices in Rugby and Dunchurch
According to Rightmove data, the average sold house price in Rugby over the past year was £309,022. By comparison, Dunchurch recorded an average sold price of £400,498 over the same period, underlining the historical price premium attached to village properties.
However, in recent years this premium has certainly softened, with the Office for National Statistics recording a decrease of around 10.5 per cent in property prices in the Dunchurch, Stretton-on-Dunsmore and Marton region between September 2023 and September 2024, one of the largest declines in the local area. In the last 12 months, Rightmove has also highlighted a 12% decline in Dunchurch sold prices.
Why prices may have fallen
While Dunchurch itself is not allocated for large-scale housing growth and planning policy limits new supply within the village, transport and infrastructure concerns remain central to local discussion around the South West Rugby development.
Planned improvements such as the Homestead Link Road (HLR) are intended to support new housing and reduce pressure on existing routes, although residents have expressed concerns about congestion, pressure on local infrastructure such as GP surgeries and schools and loss of green corridor land and recreation space, all of which will certainly be on the minds of potential homebuyers.
What else could be having an impact on Dunchurch house prices?
Whilst the South West Rugby development is likely to have an impact, there are a range of other market factors which have been influencing property values across much of the UK over the past few years, as well:
- Higher borrowing costs: Mortgage rates remain significantly above the historically low interest rates of 2009-2022. Even as some rates have eased in the last 6-9 months, the overall cost of borrowing remains higher than in the early 2020s, limiting purchasing power for many households and dampening demand.
- Correction after the 2022 peak: The UK housing market experienced a post-pandemic surge that pushed prices to record levels. Since then, many areas have seen prices moderate, or even fall, as part of a broader market correction rather than isolated local effects.
- Increased supply and buyer choice: Nationwide, the number of properties listed for sale has risen to multi-year highs, giving buyers greater choice and reducing urgency. This shift translates to stronger negotiating power for buyers and can suppress price inflation.
- Market uncertainty around policy and tax: National fiscal uncertainty, including speculation ahead of the recent Budget, has dampened buyer confidence at times, leading to slower sales and downward pricing pressure.
- Shift in buyer preferences: While demand for larger, rural homes remains, the surge in demand seen during the “race for space” period of the pandemic has eased. Buyers are taking longer to move and are more sensitive to affordability, contributing to slower market momentum.
Looking ahead
National forecasts for the housing market in 2026 point to modest growth overall, but with significant variation depending on region, property type and local conditions. Rightmove has forecasted a rise of around 2% for average asking prices nationally, reflecting improving affordability, high levels of buyer choice and stronger activity following the Budget and Christmas period.
Similarly, other industry forecasters point to a broadly positive but cautious outlook with most suggesting a 1-4% house price rise thanks to lower mortgage costs and wage growth outpacing price growth. Savills are expecting sustained growth in the longer term, too.
As for Rugby and nearby villages such as Dunchurch, the South West Rugby development is likely to support wider housing demand in the area over the long term, if the associated road, school and transport improvements do materialise. However, given the current trends in Dunchurch prices, which have softened in recent years, any uplift linked to new infrastructure and broader market recovery is likely to be gradual rather than immediate and a return to the exceptional price rises of the early 2020s is unlikely.
Article written by Ben Johnson
