The number of Londoners moving to buy homes outside the capital has increased by 78% over the past 10 years, and young professionals are leading the exodus.
New research from Hamptons International has revealed a new trend emerging among London-dwellers, and it shows how the country’s housing market continues to rebalance across the regions.
According to the statistics, 73,000 people living in the capital chose to buy property elsewhere in 2019, which is up more than 10,000 from five years ago and around 32,000 from 10 years ago in 2009.
And they’re not just moving to commutable towns and cities around London any more. Last year saw the highest number of Londoners move to the north of the country at 13%, up from just 1% who did so a decade ago. A further 15% moved to the Midlands.
While the highest proportion (69%) did stick to the south when they said goodbye to the capital, this is a major fall from 92% back in 2009.
What’s behind the shift to the north?
Prices: High house prices in London and the surrounding area mean homeownership is unattainable for many, whereas the options are much greater in the north and Midlands, or even in commutable locations to a lesser extent. Not only that, but property in the north and Midlands is expected to see its value rise over the next five years much faster than it will in London, so investment prospects are much more promising.
According to the statistics, almost a quarter (24%) of those who left London to buy property in 2019 were first-time buyers, up from 22% in 2016 and just 14% in 2013. Even with stamp duty cuts and the Help to Buy scheme, the shift shows how people’s attitudes towards where they want to own their first home are changing.
Jobs: While house prices away from the capital have always been more affordable, this only partially explains the shift. Another major contributing factor is employment – a large number of major companies have relocated or opened new offices in the north and Midlands over recent years, bringing more investment and job prospects to these areas. As the talent pool in these areas has grown – markedly in the likes of Manchester, Liverpool, Leeds, Birmingham, Nottingham and surrounding areas – so too have the investment prospects and attractiveness of these areas.
This is another important finding from the research by Hamptons: the average age of a London-dweller buying property elsewhere has fallen to its lowest level at just 39, compared to 47 in 2009. While people were more likely to spend a significant proportion of their career lives in the city before settling elsewhere, this is evidence that the improving job prospects outside London mean people can move at a younger age.
Quality of life: City-living has seen a revival in recent years, as people look for convenient places to live near work, with lots going on socially as well. Investment in cities and town centres outside London has led to significant improvements in public transport, property options, pollution levels and green space in recent years, and the increased affordability means people can enjoy a better quality of life in these areas.
Where are the best places to invest outside London?
London will always be one of the first places people think of for property investment, particularly investors from overseas. Historically, the housing market there is strong, and rental demand will always be high, so if you choose the right part of the capital you can still make good returns.
However, whether you’re a first-time buyer looking to get onto the property ladder for an affordable price, or an investor looking for good yields as well as capital appreciation prospects, there is the potential for greater value away from London.
While house prices are forecast to rise the most in the north-west over the next five years, they are still considerably more affordable than in the south, so an excellent investment prospect whatever type of buyer you are. It is always worth looking at what investments, regeneration schemes and transport improvements are underway or planned for an area to help you predict how it might perform, as well as ensure that the rental prospects – if applicable – are high.
For more information on some of the most exciting towns and cities outside London, have a look at our area guides. You can also browse our investment opportunities here, many of which are open to both investors and owner-occupiers.