Homebuyers and property investors are quitting the capital in search of more space and better value. What’s behind the rise in the London exodus trend?
Changing work patterns, additional space and more affordable prices outside the capital are causing many Londoners to buy elsewhere. The stamp duty holiday has only added to the appeal as the tax savings caused many to fast-forward moves to more rural locations with outdoor space.
Aneisha Beveridge, head of research at Hamptons, says: “Pandemic-fuelled city outmigration shows no signs of slowing. Despite lockdowns easing and offices and restaurants reopening, Londoners have continued to re-evaluate where they want to live, with many bringing future-planned moves forward.
“While London now attracts more buyers from outside the capital than pre-pandemic, the numbers are still low relative to those leaving, meaning London’s population is likely to fall this year.”
Throughout the first half of 2021, Londoners purchased 61,830 homes outside of the capital. This is a record-breaking figure for a six-month period, according to research by Hamptons. The major London estate agency first began collecting this data back in 2006.
In the first half of this year, Londoners accounted for 8.6% of all buyers outside of the capital. This is up from 6.6% in 2020. First-time buyers make up a quarter of all those who are leaving the capital. Additionally, Londoners are even moving further than ever before.
Transactions across Britain have increased by 52% during the first half of 2021 compared to the same period in 2019. Properties bought by Londoners outside of the capital were up by an impressive 85%. This is an increase on the 33,480 homes purchased in the first six months of 2019.
A migration of professionals
A recent analysis by recruitment outsourcing specialist Guidant Global reveals London has been losing more highly skilled professionals to smaller cities and towns across the UK. And this is happening at a rate more than the capital is gaining professionals.
The talent migration is a side effect of the pandemic as professionals are looking for better value for money and quality of life. Buyers and tenants alike are using it as a time to make permanent relocations.
Property investors are following suit
London will always be one of the top property investment hotspots in the UK, especially for overseas investors. Although it still has strong investment prospects, the situation has been shifting for quite some time now.
Property investors searching for higher rental yields bought the furthest away from London at an average of 108.7 miles, according to Hamptons. London is often not a top spot when it comes to yields. Additionally, a major draw for investing further away from the capital is housing affordability.
For some time now, investors have started to look towards the north and Midlands for better entry prices and higher yields. This will likely continue in the coming years as the London exodus continues.