London has always attracted masses of young people and is a hub for young adult life from the wide choice of universities and job opportunities. However, it seems the pull of London life is beginning to wane due to various obstacles young people face. Will this trend persist? Let’s explore some of the reasons.
High house prices were noted as the key contributing factor behind the exodus from a recent survey. It estimated that half a million young adults could leave London in the next year, highlighted in a report conducted by Pocket living. The results found more than 50% saw prices as a deterrent, 30% found mortgage rates unaffordable and, 27% didn’t have enough funds for deposits set. With this in mind, it is unsurprising that amongst those who took part in the survey only 22% of people living in the city have the desire to buy a house in the next year. The other 73% didn’t note this as their top priority.
Additionally, about 12% of Londoners plan to buy outside the city, while 4% plan to rent. In the next 12 months, little over a fifth of respondents (18%) plan to rent in the city. 15% of respondents polled stated they intend to leave London in the coming year.
Changing attitudes towards London
In contrast, 71% stated life in the city as satisfactory and, 51% believe that housing costs inflated. The report by Pocket Living remarks on how the unreachable capital prices for many buyers “threatens to generate a resentment among the people London needs most – the 25- to 45-year-olds who have made the city their home and who form the key workforce of most of the capital’s companies and public sector agencies. There is strong support for affordable housing and a desire to remain [there]: 76% of our respondents agreed that there is a greater need for affordable housing to ensure the vibrancy of London. Almost two thirds (62%) agreed with the statement: “I really don’t want to move outside London to afford a home because I would have to sacrifice too much to do so”.
Between the homeowners surveyed, the paths took to accomplish their goals varied. With an average price of £490,000 paid for their homes, buyers could have spent drastically less if they relocated to another UK city into an equivalently sized home.
38% had to pay a deposit exceedingly more than 20% and, less than a third had no help with paying their deposit. In the case of parental involvement, the poll showed 34% gained financial aid from a parent, and 31% had none.
London deposits are now sky-high
Research conducted by Hamptons remarked on how Londoners bought 60,000 homes earlier this year in another area of England. With first-time buyers making up being a record-breaking amount of this, standing at 25%.
Another comment made in the Pocket living report was: “Buying a home in London has rarely been more difficult, with house prices dramatically out of sync with most people’s earning power, capacity to raise a deposit and cost of living. At the turn of the millennium a typical professional couple needed to raise a £20,000 deposit to buy a home in London. According to the Halifax, * in the 12 months to February 2020, the average deposit put down by first-time buyers in the capital was calculated at £111,321, but in the 12 months to February 2021 the amount needed for a deposit in London was shown to have risen by £20,000 to £132,685.”
With the influx of sky-high housing rates, more people than ever are fleeing London and moving towards the north. Northern powerhouse cities such as Manchester, Liverpool, Bradford, Lincoln, Durham, and Newcastle are seeing a plethora of foot traffic from people relocating from London due to its lower housing prices, vast amount of regeneration projects and the immense amount of opportunities being introduced.
For a chance to find out more about the Northern powerhouse investment opportunities we offer, please contact us at: Marketing@big-roar.com or call us as +44(0)116 232 5129 for your free property consultation.