Why are homebuyers ditching the British countryside for the city? Liverpool is a post-pandemic hotspot outpacing London, with Leeds, Manchester, York and Bristol properties on the rise too
- Liverpool is up to 60 per cent cheaper per sq ft than London, and other prime regional cities, according to Savills, include Cambridge, Oxford, Bath, Winchester, Glasgow and Edinburgh
- The redevelopment of Liverpool Docks is being compared to London’s Docklands, now known as Canary Wharf, with projects such as Tobacco Warehouse at Stanley Dock
Is the recent love affair with the UK’s rural regions fading? Latest research by property advisers Savills suggests that – for the first time since December 2020 – annual house price growth in well-connected urban markets is higher than that in more rural settings.
The data shows that, on average, the UK’s prime country and coastal markets continue to grow, gaining 1.2 per cent over Q2 2022, following a 2 per cent increase in the first quarter – but at a far slower rate than the 16 per cent growth recorded since the start of the pandemic.
Overall, according to Savills, homes in prime urban markets with good transport links to major UK cities gained 7 per cent year on year, versus 6.7 per cent growth in surrounding areas. Some of the strongest quarterly growth in Q2 was recorded in Tunbridge Wells (4.2 per cent), York (3.1 per cent) and Loughton in Essex (3.1 per cent).
Frances McDonald, research analyst at Savills, says the market is starting to readjust following two years of unprecedented growth. “However, the slowdown is driven by lower levels of price growth in markets which saw the highest level of buyer demand over the course of the pandemic, rather than price falls,” she says.
McDonald believes that after two years of the pandemic-fuelled race for space both inside and outside the home, urban areas are back in favour.
“Now that employees are back in offices and UK cities have come back to life, demand for housing in urban areas is growing, and the distribution of price growth is beginning to change,” she said. “As the market starts to rebalance, we are seeing price growth in urban markets surpass growth in surrounding rural markets.”
Even with hybrid working arrangements becoming more conventional, workers still want to be close to the office, McDonald continued.
“But buyers have not left all pandemic hang-ups behind. Having access to outdoor space is still important to buyers, so markets that combine strong connectivity as well as large numbers of properties with gardens can expect to see strongest demand over the next couple of months,” she added.
The lure of urban living is also becoming more popular with downsizers who recognise the opportunity to sell in a market where demand hugely exceeds supply, and who are keen to trade-in country pads in exchange for properties in cities such as York, Bristol or Winchester, McDonald adds.
