Londoners are buying the lowest share of houses outside the capital in more than a decade as their moving plans are curtailed by a stalling local market and the shift back to office working.
They were behind just 5.3% of house purchases elsewhere in the country in the first seven months of this year, the lowest proportion since 2013, research has found.
The number of transactions – 31,620 up to the end of July – is about half the 63,600 in the same period in 2021 at the height of the Covid pandemic-driven “race for space”, according to an analysis of data from Countrywide estate agents.
“The return to the office has played a role in curbing the appetite for long-distance moves, but it’s the lack of price growth in the capital that’s really clipped the wings of would-be leavers,” said Aneisha Beveridge, the head of research at the real estate company Hamptons, which carried out the analysis.
“Many London homeowners simply haven’t built up enough equity to make the leap to where they want to go, especially as prices outside the capital have continued to climb.”
She said Londoners’ tightened budgets were evident in their top choice of location – Dartford in Kent, followed by places such as Epping Forest, just north-east of London, and Thurrock in Essex – compared with Broxbourne in Hertfordshire and Sevenoaks in Kent in 2015.
“We’re seeing a clear shift in where Londoners are heading. The pandemic pushed buyers into leafier, more lifestyle-driven locations, but today’s movers are more pragmatic,” Beveridge said.
As growth in prices in the capital has slowed, or even gone into reverse in some areas, someone leaving inner London can afford a 32% smaller home than in 2016, Hamptons found, losing them on average the equivalent of 553 sq feet or two double bedrooms.
Prices have risen 26% outside the capital over the last five years, triple the 8% pace recorded in London.
Separate data published on Monday by the estate agents Knight Frank showed that average house prices in prime central London – which stretches from Chelsea to Camden and Notting Hill to Westminster – fell 3.2% in the year to August. Prices in prime outer London – defined as Barnes, Battersea, Canary Wharf, Chiswick, Clapham, Fulham, Hampstead, Richmond, Riverside, Wandsworth, Clapham, Wapping and Wimbledon – were up 0.5% on average but the number of transactions across London as a whole was down 6%.
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The data from Hamptons and Knight Frank is the latest evidence that the pandemic-driven flight from London has gone into reverse, with homes by the sea seemingly losing some of their appeal and fewer people looking to escape from cities.
The property website Rightmove said in April that London was once again the most searched-for location on the website, and the majority (58%) of people living there were looking to stay rather than leave.
Homes near the sea are now taking longer to sell compared with the period immediately after the start of the pandemic. In coastal areas, the time it takes to find a buyer has gone up from an average of 52 days to 73 days.
