Londoners fleeing high mortgage rates have set a record trend by quitting the capital, purchasing 7.7% of all homes sold outside London during the first half of 2023.
This shift, driven by the need for affordability, is set to save mortgaged buyers a total of £357 million each year in annual mortgage payments.
The statistics show a decrease from the 7.9% recorded in 2021 and 2022. However, despite the overall slowdown in transactions, the figure remains above the 2015-2019 average of 6.9%.
Londoners bought 32,600 homes outside the capital during the first half of this year, marking the second lowest figure since 2015, excluding the Covid-affected period in H1 2020.
First-time buyers are leading the trend, making up a record 30% of those who traded London for another region in Great Britain.
By moving further than ever before, an average of 25 miles from their former London homes, they are set to save £8,656 in annual mortgage payments.
The affordability pressures were evident, as the average London leaver spent £429,800 on their new home, a decrease of £60k compared to those who left the capital last year. Consequently, 37% of London leavers purchased a one or two-bed home, up from 33% last year.
London outmigration has shown that higher mortgage rates are replacing the need for space as the primary reason for leaving.
This year, more than a third (37%) of London-based first-time buyers left the capital to purchase a home, the second-highest figure since records began in 2009.
According to Hamptons, London leavers are increasingly trading the South East for more affordable parts in the East of England. While 39% of households permanently leaving the capital moved to the South East of England, down from 45% in 2022, one in three London leavers headed to the East of England.
Aneisha Beveridge, head of research at Hamptons, said: “Higher mortgage rates have paused the unwinding of arguably the biggest Covid-induced trend in the housing market – London outmigration.
“Rather, this year London outmigration has increasingly been driven by need over want as higher mortgage rates reduce buyers’ budgets, pushing them in search of smaller homes in more affordable areas.
“Most of these movers still look to retain strong links with the capital.”
