In 2020, London leavers bought £27.6 billion worth of property outside the capital in an attempt to escape the Big Smoke in this era of lockdown and pandemic.
According to the Financial Reporter, Londoner’s bought a total of 73,950 homes outside the capital this year, the highest number in four years. And this is despite the housing market being closed for seven weeks back in the Spring.
While Londoners are certainly looking to escape the city, they’re not looking to move too far afield. As such, Sevenoaks recorded the biggest increase in the share of homes bought by Londoners who, in total, accounted for 62% of home purchases in the area.
Windsor and Maidenhead comes next with 27% of homes being bought by London leavers, then Oxford and Rushmoor.
Despite this migration away from the capital, on the list of areas which have seen the most significant house price rises in 2020, London boroughs still rule the charts.
According to The Guardian, Islington, North London, has seen the biggest increase in average price (13%), while the southern borough of Croydon sits 3rd on the list with price rises of 10.9%.
While some London boroughs continue to thrive, others are struggling. Hackney, the once highly sought after East End borough saw the average house price drop by 1.5% in 2020, unheard of in recent years and a sure signifier that demand for trendy city living is not quite as high as it once was.
Parts of The North keep booming
In between Islignton at number 1 and Croydon at number 3, we find Leeds, West Yorkshire, at number 2. In 2020, the city’s average house price rose by more than 11% representing the healthiest rate of growth outside of London.
Also in the top 10 is Doncaster, South Yorkshire, where prices have gone up by almost 9%, and Inverness in Scotland where prices are up 8.1%.
Elsewhere in The North, Manchester is also performing very well. According to the most recent Zoopla price index, the heart of the Northern Powerhouse has enjoyed an average house price increase of 5.7%.
Nottingham and Liverpool saw a rise of 5.4% and 5.3%, respectively.
Looking forward to 2021
With house prices performing well against all expectations in 2020, what can we expect as we enter the new year?
Ask a different person and you’ll get a different answer; that’s the truth of it at the moment because nobody can seem to agree on what will happen to the housing market in 2021. It’s not a huge surprise that we have conflicting opinions – when the world itself is so hard to predict, house prices are too – and there is actually a lot of consensus when looking at the first quarter of the year.
House prices will keep rising and demand will stay high at least until the end of March and the end of the stamp duty holiday.
There is a chance that the government will extend the SDLT holiday beyond March, certainly if national lockdowns remain a part of our lives, in which case we can expect the current trends to continue.
But if the scheme comes to end as scheduled, the 6-12 month projection of the housing market is hard to nail down. If, for example, the Covid vaccine successfully brings mass immunity to the country, the end of 2021 could see a great boom in demand for new houses as people feel more confident about finally making that move.
If, however, we’re still in our current situation in 6 months, one can only imagine that the housing market and the economy in general will be under significant strain.
For now, up and down the UK, houses are in high demand and the market is playing a central role in keeping the nation’s economy afloat.