If, during your credit-crunch-busting, Cameronesque family holiday in Cornwall, you slipped away from the bucket and spade brigade for a peek in the local estate agent's window, you are not alone. Cornwall's inflated housing market, due to its fashionable status as a second-home destination, might have been expected to curl up and die like a Rick Stein crab sandwich left out in the sun. However, the top end of the Cornish market - new-build flats included - is defying the national trend.

Last week, amid ever-more lurid headlines bemoaning housing market woe, The Times reported that July had been a bumper month for estate agents in the South West. Savills' Southampton office was reported to have had the best sales month since opening five years ago. Richard Copus, an agent in Newton Abbot, Devon, found no evidence of an economic slowdown, claiming that “viewings have increased and offers are being made. I think people are bored of hearing about the credit crunch and want to get on with their lives.”

Tell that to developers of new-build flats in northern cities, who can't heap enough price-slashing promotions on to their empty developments.

Not so in Cornwall. Miles Kevin, of Knight Frank's Exeter office, which covers Cornwall, says that “the best properties still sell. Six weeks ago we sold 15 flats off-plan in one day in a new development, Tregurrian in Watergate Bay. The two-beds went for £750,000 - that's Kensington prices. This is driven by buyers who don't need mortgages, and it's not just London money - buyers come from all over the country”.

Since our last report, the summer season, traditionally a dead time for estate agents, has accelerated even faster. Jonathan Cunliffe, of Savills' Truro office, claims to have tied up five deals of more than £1.25 million in the past two weeks.

Lillicrap Chilcott's office in Truro is “stonkingly busy”, with agreed sales on 29 houses in 31 days last month. “July 2007 was a record month for us, but this July was even better”, says Ian Lillicrap. “Cornwall is bucking the national trend because we're only a small place and good houses are always in short supply, so people are always willing to take a risk. Cornwall has benefited from the market problems elsewhere. No-one wants to buy in Spain or even go there on holiday, because the exchange rate is bad and flights are expensive, so people are holidaying in Cornwall and they like what they see.” The difference between previous summer seasons, according to Lillicrap, is that this year, “many more of our buyers are moving lock, stock and barrel to Cornwall - it's their main residence, not a second home”.

Typical of the type of Cornish properties flying off Lillicrap Chilcott's shelves is Trist House, a Georgian vicarage in the beautiful village of Veryan, near Truro, home to Graham and Brenda Salmon.

Both have hobbies that captivate their waking hours - his is astronomy, hers is gardening. So when they moved to South Cornwall from West Sussex in 1994, finding the ideal home was quite a challenge. This house offered Graham the opportunity to build an observatory. More important, it gave Brenda the chance to recreate and restore the most important parsonage garden in Cornwall - a five-acre garden which now regularly features in gardening magazines.

Yet when the couple bought Trist House for £294,000 it was in a sorry state. “The inside of the house was painted orange and it was oppressively dark,” remembers Brenda, who is 73. “It was horrible but I saw that it could be restored - it hadn't been knocked around at all. Similarly, the gardens were just grass - a blank canvas, if you like.”

The house was built in the 1830s for £3,000 - a considerable sum then, and £210,000 in today's money - by Samuel Trist, Veryan's vicar. Trist also spent £1,000 on the garden. He created a small lake, a grotto and a pleasure garden; he also planted trees and built 12 impressive rockeries. By the time Brenda took over the garden most of these features were sadly overgrown - they were beneath the surface of her blank canvas.

Brenda says: “I wanted to create a jewel of a formal garden at the centre and to have rougher woodland at the edges,” she says. Her vision has been realised. Now, to the front of the house there are beautifully manicured lawns on three terraces. To the back of the house there is a folly and a Victorian pergola; a swimming pool has been dug and the excavated earth has been formed into a rose walk. Perhaps the most impressive feature is the extensive rockery and pool.

It was Graham, 75, who encouraged Brenda to open the gardens to the public in 2002. “I thought it would mean her work would receive the appreciation it deserves,” he says, dryly. “She certainly wasn't going to get that from me.”

As for the house, you will find classically well-proportioned Georgian reception rooms, all with 11ft-high ceilings, including a comfortable study, a quite feminine drawing room and a sizeable dining room. There are three staircases leading to the first floor which comprises, in all, eight bedrooms and three bathrooms, not forgetting Graham's purpose-built observatory with its roll-back roof.

The Salmons now intend downsizing to be near their daughter, Virginia, and her family in Dorset.

It's not surprising to hear that, after two weeks on the market, the owners of Trist House have already accepted an offer believed to be in excess of the £2.25 million asking price. Cash-rich househunters are coming back from this year's Cornish holiday with lighter wallets.

Lillicrap Chilcott: 01872 273473

Fast facts

The average house in Cornwall costs £210,173, down from a high of £212,152 in February, according to the Land Registry

In June 2000, the first month of the Land Registry house price index, the average price was £78,631

There were 596 sales in Cornwall in April (the most recent figures available), down from 1,191 in August 2007 but up from 491 in March.

Nine out of the ten most expensive seaside towns in the UK are in the South West, led by Rock (average price: £361,838) and Fowey in Cornwall, and Sandbanks, Poole, according to the Halifax.

Explore Property

• Buying & Selling

• New Homes

• Overseas

• Interiors

• Investment

• Gardens

• Cool In Your Code

• Specials

• First-time buyer

• Rental Market

Times recommends

• Second homes: credit crunch casualty or money-spinner?
• How I built my own sliding house
• Top 10 incentives for house buyers