London no longer drives the UK housing market
The housing market is seeing a ‘reverse ripple’ effect, as a resurgence in activity in England’s regions begins to filter through into Outer London, according to estate agent Haart.
It found that house prices have started rising rapidly in regions such as the East and South East of England, while they remain flat in Outer London and continue to fall in central London areas.
The reverse ripple
The estate agent’s data revealed that branches around 100 miles away from the capital have seen an average 75% increase in activity month on month in September, while those around 45 miles away from the capital have seen an average 37% increase in activity over the same period. Regions closer to London but outside of the M25, such as Kent and Anglia, have seen activity grow by 5.5% and 6.9% respectively. The ripple begins to weaken as it crosses the M25, with activity in haart’s Middlesex and South London regions falling by 4.3% and 5.7% respectively. Growth inside of the M25 overall sat at a much weaker 1.1% during the same period.
Paul Smith, Chief Executive of haart, said: “The evidence from our branches is that areas around 100 miles from the capital are where the market is reviving, and this is spreading towards the South East and London – a complete reversal of the traditional ‘London first’ pattern we’ve grown used to.
“This could be a historic realignment of our property market away from central London, or a purely post-Brexit ‘flash in the pan’ phenomenon. What is clear is that since June, Britain’s property market has been turned on its head and London, for a change, is beginning to rely on the rest of the country for life-support.”
Rising activity levels being reported by Haart branches are also reflected in rising house prices. The latest ONS UK House Price Index reports that the East of England is currently experiencing the highest growth in terms of house prices across the UK, at 13.3%, and the South East is seeing growth of 12.4% – overtaking London consecutively in the months since the Brexit vote.