Londoners are set to spend £28.7 billion on homes outside the capital this year, marking a significant 41% or £20.1 billion drop from the £48.8 billion recorded in 2021 when outmigration peaked
The number of Londoners leaving the capital to move elsewhere in Britain declined sharply in 2023, after two years of near-record outmigration levels.
Londoners are set to spend £28.7 billion on homes outside the capital this year, marking a significant 41% or £20.1 billion drop from the £48.8 billion recorded in 2021 when outmigration peaked.
The decline was led by two factors, according to estate agency Hamptons.
Firstly, given that fewer homes were sold nationally, London leavers are buying in smaller numbers too. The number of homes bought by Londoners outside the capital dropped to 69,190 in 2023, the lowest figure in nine years and down from a high of 100,980 in 2021.
Secondly, the reality of higher mortgage rates mean London leavers are also spending less on their new home outside the M25. Affordability pressures meant that the average Londoner buying outside the capital spent an average of £415,020 in 2023, £89,990 less than the £505,010 average spend last year.
Even though the number has declined, affordability pressures have meant that the rate of London outmigration has risen over the past year and remains higher than pre-Covid.
Londoners made up 7.7% of all buyers purchasing property outside the capital in 2023, up from 7.3% in 2022 and 6.8% in 2019. Nevertheless, the pace of London outmigration remains lower than when it peaked at a 15-year high of 7.8% in 2021.
Of the 32,090 households who sold a home in London and purchased outside the capital, a record 77% spent less on their new home than they sold their main residence for. This figure has climbed from 60% in 2022. On average, movers are spending 39% less on their new home outside of London.
This releasing of equity has meant that a record number are paying cash for their new home outside the capital. Of the households spending less on their new home in the regions, a record 81% purchased without a mortgage, up from only 51% in 2022.
Typically, these are older generations leaving London for a smaller home, downsizing to free up equity or clear their remaining mortgage balance amid higher interest rates.