The share of Londoners buying outside the capital has slowed this year
(Picture: Shutterstock / ZGPhotography)The number of Londoners buying homes outside of the capital slowed this year, returning to levels seen before the ‘race for space' sparked by lockdowns and a stamp duty holiday at the height of the coronavirus pandemic.
More than 81,000 homes outside the capital were bought by Londoners in 2022 — equating to 20,000 fewer purchases than in 2021 when Londoners bought 7.8 per cent of all UK homes sold outside of London, according to a new report by Hamptons.
Key additions to property jargon over the past two years include 'London leavers', 'TW*T commuters' and 'boomerang buyers' but the reopening of city offices didn't translate into the immediate boomerang effect some imagined for the property market.
So, with flexible working still a reality for many, Londoner migration to areas outside of the capital remains above the levels seen in 2019.
Hamptons’ head of research Aneisha Beveridge, said: “London outmigration appears to have passed its peak. While 2021 was dominated by space seekers swapping the bright city lights for pastures green, 2022 signalled the return to the office.”
“That said, the widespread popularity of flexible working has meant that Londoners continue to move that little bit further out of the city to gain more space, meaning outmigration numbers remain higher than pre-Covid times.”
The 'race for space' sparked fierce competition in suburban areas meaning that buyers have had to move further afield — 4.4 miles further on average — for homes that meet their requirements. The sudden influx of buyers hoping to make savings of up to £15,000 by completing before the end of the stamp duty holiday in June 2021 saw strong price growth outside of London.
Higher house prices and tighter household budgets mean that while 30 per cent of movers were able to buy homes with four bedrooms in 2020, this fell to 26 per cent of movers able to do the same in 2022.
First-time buyers sacrifice location for the ladder
Despite the number of London movers buying outside of the capital dropping towards levels seen before the pandemic, affordability pressures mean that first-time buyers accounted for a record 28 per cent of those buying outside of London in 2022.
“Next year, we expect the pace of London outmigration to cool further as pent-up demand from the Covid related trend wanes,” said Beveridge.
“But affordability pressures, and in particular the cost of higher interest rates, may mean that more Londoners are forced to move further afield to buy a home.
“Our latest data suggests that first-time buyers in particular are sacrificing location in order to climb onto the housing ladder. And this looks set to put a floor under London outmigration numbers in 2023.”
Buy-to-let investors look to leave London
The search for higher returns to cover rising costs has seen London-based investors increasingly look to other regions.
A record 21 per cent of those buying in the regions in 2022 were London investors, which is up from 16 per cent in 2021.
So while the share of investors and first-time buyers finding homes in UK areas outside of London has exceeded levels seen before the pandemic, the share of movers buying outside of London is declining.
Where are movers searching?
Household budgets aren't stretching as far as they once did — strong house price growth outside of London, the cost of living crisis and rising interest rates make for a perfect storm.
Londoners choosing to buy outside the capital are moving 34 miles away on average, an increase of 1.2 miles compared to last year.
Top 15 areas with the biggest increase in London home hunters
Local authority |
Region |
Percentage of applicants from London in 2022 |
Change since 2019 |
Wiltshire |
South West |
16% |
15% |
Swale |
South East |
23% |
13% |
Mid Sussex |
South East |
23% |
13% |
Hart |
South East |
23% |
12% |
Bath and NE Somerset |
South West |
21% |
12% |
Middlesborough |
North East |
17% |
12% |
Tonbridge and Malling |
South East |
23% |
11% |
Medway |
South East |
34% |
11% |
Hertsmere |
East of England |
77% |
10% |
Brentwood |
East of England |
30% |
8% |
North Hertfordshire |
East of England |
20% |
8% |
Horsham |
South East |
17% |
7% |
Tunbridge Wells |
South East |
25% |
7% |
Basildon |
East of England |
30% |
6% |
Chichester |
South East |
15% |
6% |
Source: ONS & Hamptons
What’s next for house prices?
The latest house price index from property portal Zoopla suggests demand for urban areas is increasing as the flight to rural and coastal regions “runs out of steam”.
Asking prices have increased 7.2 per cent over the last year, but falls are expected for the first half of 2023 in line with other forecasters.
Chris Druce, senior research analyst at Knight Frank, comments: “After a frenetic period for the country market, city living has come back strongly as workers have returned to the office, and the lifting of pandemic restrictions have boosted the appeal of urban living.”
