Fifty per cent more Londoners buy homes outside the capital in 2014.
First time buyers represent the fastest growing group of London leavers
• Londoners bought 58,000 homes outside the capital in 2014, 50 per cent more than in 2013 and the highest number since 2007 (see chart 1)
• Sellers leaving London spent over £21 billion on homes outside the capital in 2014, almost double the £13 billion spent in 2013 (see chart 2)
• First time buyers are the fastest growing group of London leavers. Fifteen thousand Londoners chose to make their first home purchase outside the capital in 2014, a 70 per cent increase on 2013
• Eighty per cent of London buyers bought homes in the South East and East of England, within commuting distance of the capital
The number of Londoners buying homes outside London increased by 50 per cent over 2014 and is now at its highest level since 2007 (when data was first collected). In new research published today, leading residential agents Hamptons International, reveal a significant increase in the number of Londoners buying homes outside the capital. In total Londoners bought 58,000 homes outside London in 2014 worth a total of £21 billion.
Eighty per cent of Londoners moving out of the capital relocated to the South East and East of England, representing a record proportion of purchases in these markets. Londoners accounted for 18 per cent of sales in the Home Counties in the last quarter of 2014, the highest recorded since data was first available in 2007. In total Londoners moving out bought 45,000 homes over 2014 worth £17 billion in the East and South East.
Commenting on the analysis Johnny Morris, Head of Research at Hamptons International said:
“2014 has seen a significant rise in the number of Londoners moving out of the capital. Over the downturn many Londoners delayed life stage moves, restricting the natural flow of families out of the capital and building a pent up demand.
“As the gap between house prices in London and the rest of the country has widened to record highs, of £282,000, and expectations of future house price growth have moderated, many Londoners are now choosing to cash in and move out of the capital. Although most aren’t severing ties, some 80 per cent of those moving out bought homes within commuting distance of the capital in the South East and East of England.
“The price gap has not escaped the notice of first time buyers either, 15,000 Londoners made their first home purchase outside the capital in 2014, a 70 per cent increase on 2013. This equates to about 30 per cent of the capital’s first time buyers choosing to purchase outside London. High house price growth over 2014 has further raised the barrier for first time buyers looking to access the housing ladder in London, leading many to look to cheaper areas with good transport links to the capital.
“First time buyers leaving the capital are spending £192,000 on average, compared to £248,000 spent by those buying in London. That means that those leaving the capital need about £10,000 less in stamp duty and deposit and will pay £250 less a month in mortgage payments. Those leaving the capital are also getting an extra bedroom, with three bedroom homes being the most common, compared to two bedroom properties bought by London first time buyers.
“We expect the flow of Londoners out of the capital to continue to increase over 2015. This will drive markets in the South East and East, and is one of the key reasons we are forecasting price growth in these areas to outperform both London and the rest of the country.”