More and more Londoners are purchasing homes further away from the capital in a bid to get a better bang for their buck.
The average person moving from the city bought a home a record 39 miles outside the city between January and June, according to a report from broker Hamptons International. That’s six miles further than in 2019 and 65% more than the typical first-time buyer.
“Four years on from the pandemic and many city workers have settled into a new normal when it comes to going into the office,” said Aneisha Beveridge, head of research at Hamptons. “In a bid to make their equity stretch further, movers continue to make longer distance moves out of the capital.”
UK households are facing a mix of cost pressures triggered by higher interest rates and a cost-of-living squeeze. While home loan rates are steadily declining from the 15-year high they reached in 2023, the number of UK mortgaged properties taken into possession rose 8% in the second quarter of this year.
Over 25% of households trading a London home for one outside the capital moved more than 100 miles away in the first half, significantly higher than the 17% average recorded between 2015 and 2019. On average, London leavers are moving 50% further than they were a decade ago, with high transaction costs reducing the number of shorter, more frequent moves, Hamptons said.
Gedling and North Somerset – two local authorities based in the Midlands and western England, respectively – have seen those looking to leave London more than double in the first half of 2024 compared with the same period last year. London leavers accounted for 48% of people buying a home outside the capital between January and June.
Still, a long-running rise in first-time buyers leaving London was restricted in the first half of the year, as a steady decline in mortgage costs and lower house prices encouraged more prospective homeowners to buy in the capital. First-time buyers purchased a record 48% of homes sold in London between January and June, up from 41% in 2023 and 28% a decade ago, the report said.
What’s more, first-time buyers leaving the capital are increasingly seeking out more affordable areas closer to London rather than moving further afar. The share of first-time buyers leaving London for the countryside has halved from its 6% peak in 2020.
“Lower mortgage payments have pulled the cost of buying back below renting, bringing relief to those looking for their first home in the capital,” Hamptons’ Beveridge said. “First-time buyers with deeper pockets are looking again at London, choosing Clapham over Crawley and Wembley over Wycombe.”
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