Why London’s property market will survive the doomsayers – Telegraph.co.uk
During lockdown, I fell in love with my small corner of east London. It was inspiring: the streets of cherry blossoms, the little messages offering help pinned to lamp posts, the small businesses pivoting into a brand new venture.
But if stories from the coalface of the post-lockdown property market are to be believed, many Londoners are desperate to leave.
A survey by Totaljobs, a jobs website, estimated that 1.6 million London residents are now considering moving to rural locations permanently, after working outside the capital in lockdown. As a result of months of working from home, many are realising they can work anywhere.
Some Londoners, tired of taking Zoom calls in their bedroom, might find they can trade in their flat for a house in the countryside with a study, a garden and more – with money to spare. We’ve seen the impact of this already: demand for properties in pricey rural areas is climbing, with agents warning of a bubble in certain areas as panicked buyers offer way over the asking price in a bid to secure a country home in case of another lockdown.
Does this really represent a major structural shift in how we will live? London has experienced periods of intense decline in the past, and the city’s population has been growing for decades, so it could be due a correction.
Perhaps I – as a born and bred Londoner – am too biased to answer this question, but I wouldn’t discount the capital yet.
Analysts at property website Zoopla think this current flight from cities is overstated, but rather it represents “a shift in consumers’ focus, rather than a structural change in market fundamentals”.
In Scotland’s recently reopened property market, it’s Edinburgh and Glasgow – and not the country homes in the wilds of the Highlands – that are soaring in popularity (and price). And according to estate agent Knight Frank, in the three weeks after market restrictions were lifted, the number of offers soared by 172pc in London, almost the same level as the 178pc leap in the rest of England.
The capital’s property market has also been particularly boosted by the stamp duty holiday, due to the bigger savings that can be made: Zoopla found that sales agreed since the changes came in two weeks ago are up by 27pc, compared to just 6pc in the rest of England.
What we may see instead is a flight to suburbia and a redrawing of the commuter belt. Outer London, with its gardens and links into central London, might feel a boost in demand; the centre of the city may experience a fall as its high prices and lack of outside space outweigh the benefits of being in the thick of it.
We still don’t know the role that offices will play in the future, which is probably the most important factor when deciding the future of London. If we’re still going into the office, even if just for three days a week, a 90-minute long commute may not appeal, even if you are living in a rural idyll. After all, many of us have been spending precisely zero minutes on our commutes for months.
For me, something changed in lockdown: I found a community in London similar to the one you might find in that imaginary rural idyll. People will always want to live in the capital because it feels alive, even in the bleakest of times.