Londoners Pull Back from Provincial Property Market as House Price Growth Stalls

Londoners are buying the lowest share of properties outside the capital since 2013, as stalling prices and the return to office working sap enthusiasm for relocating. New research reveals that only 5.3% of house purchases made elsewhere in the country during the first seven months of this year involved London buyers—a marked drop from the pandemic’s “race for space” peak.

Analysis by the estate agency Hamptons, drawing on Countrywide estate agent data, shows that just 31,620 property transactions outside London were completed by Londoners up to the end of July. At the height of the pandemic in 2021, this figure stood at 63,600 for the same period. Contributing to this shift is the slowing in London house price growth which has diminished homeowners’ equity, narrowing the scope for moving out to more expensive areas.

Head of research at Hamptons, Aneisha Beveridge, noted that the appetite for long-distance moves has been dampened, not only by changing work patterns but also by the lack of price appreciation in the capital. Over the last five years, house prices outside London have surged by 26%, compared to a modest 8% in the capital—a disparity making it tougher for potential movers to afford larger or more desirable homes.

Due to restricted budgets, Londoners are increasingly targeting areas like Dartford in Kent, Epping Forest north-east of London, and Thurrock in Essex. This represents a shift from higher-priced or more lifestyle-oriented destinations such as Sevenoaks and Broxbourne favoured in the mid-2010s. Hamptons’ data suggests that an inner London buyer now can afford a home 32% smaller than in 2016, equating to a loss of around 553 square feet, or roughly two double bedrooms.

Recent data from Knight Frank underscores the pressure on London’s prime property market. Average house prices in high-end districts such as Chelsea, Camden, Notting Hill and Westminster fell by 3.2% in the year to August. Outer prime areas encompassing the likes of Clapham, Hampstead and Wimbledon saw a marginal increase of just 0.5%, while transactions across London as a whole were down 6%.

The tide appears to be turning on post-pandemic urban exodus trends. Rightmove highlighted that London is once again the most searched-for location, with 58% of current residents looking to stay put. The allure of coastal living is waning, as homes by the sea experience longer selling periods—73 days on average compared to 52 days post-pandemic. The property market is recalibrating as price dynamics and working habits evolve, leaving Londoners with fewer opportunities and smaller options when considering a move beyond the M25.