London’s housing crisis has led to a second commuter belt where prices are rising faster even though it’s further away, estate agency James Pendleton has claimed.
The firm said the data points to a critical mass being reached in the traditional commuter belt, with the commute no longer justified because of ever higher prices. This forces buyers to either travel even further out to save money or remain in London in less ideal circumstances.
Lucy Pendleton, co-founder director at James Pendleton, said: “It’s hugely counter-intuitive to see house prices rising faster, the further from London you go as it runs contrary to the received wisdom illustrated by steep rises in the capital.
“What that tells us is that there has been a generational shift in thinking. Workers in the capital wouldn’t have dreamt of commuting from some of these outliers 20 years ago but financial realities have forced people to swallow ever bigger journeys.”
The inner commuter belt contains: High Wycombe, Woking, St Albans, Reigate, Guildford, Sevenoaks, Basildon, Maidenhead, Crawley, Farnborough, Bracknell, Tonbridge, Maidstone and Brentwood.
In the outer one there is: Aylesbury, Haywards Heath, Basingstoke, Reading, Luton, Southend-on-Sea, Brighton, Oxford, Milton Keynes, Chelmsford, Ashford, Hastings and Godalming.
The average cost of a property has risen 313% over the past 20 years in London’s heritage belt – comprising towns such as Woking, Sevenoaks and St Albans – to trade at a discount to average outer London prices of 9.7%.
Meanwhile in the South East’s second commuter belt – stretching as far as Brighton, Oxford and Milton Keynes – the cost of an average home has risen 344% in two decades to trade at an average discount of 26.2% to outer London.
This runs totally contrary to the national trend. In England house prices have risen 293% from £61,902 to £243,582 in the same period, while those in outer London have grown 367% from £92,660 to £432,497.
The average price of a property in the traditional commuter belt is now £390,362, rising from only £95,331 in 1998. In the Outer Belt, homes are selling for £319,147 on average, up from £73,735 two decades ago.
The average cost of a home in outer London has risen 367% in the same period.
Two decades ago, commuting from Brighton to London was considered extreme but it’s now the norm for thousands of professionals determined to travel longer distances to save money.
Pendleton added: “The fact that hundreds of thousands of people came to the same conclusion when faced by the same economic challenges is hardly surprising and that’s what shapes these long-term trends.
“The most worrying diagnosis, however, is that there is a growing disparity between the haves and the have nots who use their respective wealth to either stay put in London or jump the traditional commuter belt in search of homes they can actually afford.”