High housing costs push Londoners out of capital

High housing costs push Londoners out of capital

The number of people leaving the capital has risen by 80 per cent in the past five years due to soaring house prices.

Net departures to places outside London totalled 93,000 in 2016 as residential property prices increased to more than twice the national average and 10-year rental growth hit 34 per cent, according to analysis by estate agents Savills.

Outward migration was greatest among those in their 30s, increasing by 58 per cent over the past five years.

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The only group with net inward movement to the capital was the 20 to 29-year-old age bracket.

According to Savills, the weighted average sale price for people leaving London is £589,836, while the average purchase price is £333,181, meaning residents could make almost £250,000 by relocating.

Prices in London accelerated sharply following the financial crisis but have recently begun to moderate.

The latest data from Hometrack showed house price inflation had fallen to a five-year low of just 2.6 per cent in London as other regions witnessed rapid gains.

Alex Reynolds, IFA at London-based Advies Private Clients, said the dynamic behind the trend was “getting more bang for your buck”.

He said: “While people are younger, being in the centre of the action and near work is clearly important.

"It doesn’t surprise me when people getting into their 30s are looking to get away from the centre. They might be starting a family and being next to everything is less important.

“Will it continue? It very much depends on property prices. If they keep increasing, with wage increases not keeping up, it will continue.

"People don’t want to start a family in a one-bedroom flat with no garden and compete with thousands of others for a local school.”