The highest number of Londoners for nine years has left the capital this year, according to the latest analysis by estate agent Hamptons International.
In 2016, the amount of Londoners buying homes outside the capital reached the highest level since 2007, the research found. Some 74,000 Londoners bought outside the capital, which is 11,000 more than in 2015 and just 16,000 fewer than in 2007, when the highest number on record was seen.
Highest Number of Londoners Leaving the Capital for Nine Years
The average Londoner buying outside the capital spent £388,000 on their new home – a total of £29 billion, which is the highest since 2007, when 90,000 homes were purchased, totalling £32 billion.
The majority of Londoners leaving the capital stayed in the south. A huge 80% of those leaving London bought in the South East, South West or East of England.
One in every six homes sold in the East of England and one in every seven in the South East were sold to someone moving from London in 2016, shows the study.
Of the 17 local authorities that border the capital, more Londoners purchased homes than existing residents in ten of them. However, as house price growth across the south (9.1% annually) surpasses that in London (7.7% year-on-year), both the proportion and number of Londoners heading further north has been steadily increasing.
This year, 20% of those leaving London bought in the Midlands or the north, compared to 12% in 2014 and just 10% in 2012. In 2016, the amount of homes purchased by Londoners in the Midlands rose by 21% on last year, while in the north it was up by 13%.
As many Londoners leave the capital for a bigger home, almost three quarters (74%) of those leaving London bought a property with three or more bedrooms, spending an average of 18% more than local buyers.
While many Londoners take advantage of being able to get more for their money, for others, leaving the capital is the only way of getting onto the property ladder. Around 40% of first time buyers living in London end up buying outside the capital, up from 20% in 2012.
The Head of Research at Hamptons International, Johnny Morris, says: “A move out of London has generally had more to do with changing priorities as people get older and start forming families than the housing market. But with affordability in the capital stretched, more Londoners are looking elsewhere to buy their first home. More too are likely to go further afield, with increasing numbers heading to the Midlands and north.
“It is likely 2016 will be a peak for London leavers. While overall the year saw growth in Londoners buying outside the capital in recent months, the pace has been slowing. A slower housing market in 2017 will likely mean that we see fewer Londoners buying outside of the capital than in 2016.”
Although the research suggests that many Londoners are deciding to leave the capital, landlords must be aware that the study only covers homebuyers. As purchasing a home is still as difficult as ever for many young people, investors should choose the right areas to cater to the high number of renters in the capital.
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