Stay up to date with free updates
Simply log in Home ownership myFT Digest – delivered straight to your inbox.
The number of Londoners swapping the capital for a home in the countryside is at its lowest level in more than a decade, following a decade of soaring house prices across the rest of the UK.
London residents bought 5.7 per cent – or 57,020 – of homes sold outside the capital this year, the lowest proportion since 2013 and almost half the Covid-era peak in 2021, according to research by estate agent Hamptons.
Real estate prices have risen by 26 percent in the year London According to Hamptons, which analyzed data from about 650 branches of fellow real estate broker Countrywide, the figure was just 39 percent over the past decade.
“The capital’s homeowners have not had the property market on their side in recent years,” said Aneisha Beveridge, head of research at Hamptons, adding that “many have chosen to stay put” “as a dream home became out of reach “.
In addition to higher property costs elsewhere in the UK, Marc von Grundherr, director of estate agent Benham & Reeves, said there would be a return to in-person work after the pandemic kept Londoners in the capital.
Londoners left smaller urban homes in search of more space in the countryside in 2020, expecting work-from-home arrangements to become permanent. But the end of the pandemic led many companies to ask workers to return to the office.
First-time buyers are “the exception”, Beveridge said, making up 31 per cent of Londoners buying homes outside the capital this year – more than double the figure in 2013.
According to the Office for National Statistics, the average London house cost £520,000 in October, despite the capital having the lowest annual house price inflation in the country at 0.2 percent.
Beveridge noted that “the high income and savings thresholds required to buy a home in London have encouraged more would-be homeowners to look beyond the capital.”
The most popular locations for first-time buyers from London were commuter towns with good transport links. Just under half of all buyers in Brentwood in Essex came from London this year, up from 23 percent in 2019.
Property prices in parts of central London have fallen over the last decade, although the capital remains by far the most expensive part of the country.
Prices in South Kensington and Chelsea fell by 11 percent and 4 percent respectively between 2013 and 2024, according to property analyst LonRes. Prices in Knightsbridge and Belgravia remained unchanged this year compared to 2013.
Neal Hudson, founder of housing consultancy BuiltPlace, said tax rises from 2014 had “hit the central London market hard”.
“Sales have fallen significantly and prices are flat or negative,” he said, adding that the market outlook for high-end real estate is “far from pre-2014 levels.”
Von Grundherr, the estate agent, said most of the home buyers he dealt with were Londoners returning to the capital after leaving during the pandemic.
In 2021, London residents spent a record £55 billion on housing outside the capital. But von Grundherr said his customers were taking advantage of stagnant property prices to return, lured by shorter commutes to the office and the capital’s cultural attractions.
“We had a couple who sold their house in London and moved to Hampshire four years ago,” he said. “But they came back in 2023 and bought a house on the street behind (where they used to live). They paid almost the same price as when they sold in 2020.”