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Fewer Londoners are searching for homes in the countryside, according to property industry data that suggests more people are opting to stay in the capital as employers encourage staff back to the office.
The proportion of London-based house-hunters looking to move out of the city has returned to the pre-Covid average of about a third, against a peak of almost half in August 2021, according to an analysis by property website Rightmove.
“We can see a resurgence in London back to pre-pandemic levels, and a general increase in the popularity of cities among buyers,” said Tim Bannister, Rightmove’s director of property data.
The analysis, based on hundreds of thousands of inquiries made on the property search platform, comes alongside figures showing house prices in London are firming up. This suggests the UK capital is regaining its appeal to homebuyers, boosted by an increasing return to in-person work.
Separate analysis by estate agent Hamptons also found that the proportion of Londoners searching for homes elsewhere in the country had returned to the pre-pandemic average level this year.
Aneisha Beveridge, head of research at Hamptons, said the “return to the office trend” was probably contributing to London’s increased popularity. She also pointed to the trend of families bringing forward their long-term plans to move out of London during Covid, meaning fewer were moving now.
Matt Thompson, head of sales at Chestertons, said London had a “steady return of house-hunters”, adding that “the increasing number of motivated buyers” was “giving sellers the upper hand during price negotiations”.
After the housing market reopened in 2020, Londoners flocked to escape small urban homes in search of space, leading to intense demand for properties in the countryside and smaller communities.
Some buyers anticipated that working from home would become permanent and looked for houses with more space, larger gardens and better access to nature.
But with more workplaces calling employees back to the office, and London attractions such as restaurants and entertainment fully reopened, the wave of increased departures has come to an end.
Bannister said: “Some industries continue to embrace hybrid or full homeworking, while others, notably financial services, continue to push to get their people back into the office.”
He added that post-pandemic trends in flexible working were still shaping some buyers’ housing searches. “We are still seeing people search further away and across a greater spread of areas compared to before the pandemic,” he said.
The UK housing market is finding its feet this year after a dismal 2023, when high and unpredictable mortgage rates put off buyers and contributed to falling house prices.
Buyer confidence has recovered as interest rates have stabilised, with the number of sales up 12 per cent year on year in April, according to online property site Zoopla, the fourth month of annual gains.
Mortgage approvals hit an 18-month high in March, the Bank of England reported last week, in a further sign of buyers returning to the market.
Asking price for homes in London began to recover from last year’s declines earlier than properties in the surrounding regions, and have had a bigger bounce, Rightmove said.
In April, Hamptons reported homes in London were more likely to sell above asking price than properties elsewhere in England and Wales for the first time since 2016.
