Stamp Duty holiday and desire for space see interest rise across wider South East.
Values in the wider South East have been closely tracking the national average for several years, whereas London has seen more volatility, according to the Nationwide indices. Table 1 shows the latest (Q2) index results, with Figure 1 showing the trend data.
Figure 2 compares the long run data and shows that the ratio of London values to the wider South East has come off its peak, but is still well above the historical average. The high point of 1.75 was reached at the end of 2015, with the latest figure being 1.62.
The relative pricing shown above, when combined with the Coronavirus pandemic potentially changing homebuyers’ priorities and the stamp duty holiday, could increase the desire and opportunity to move out of London and upsize for many families.
Rightmove have analysed their search data to try and highlight the immediate impact of the stamp duty holiday on homebuyers’ preferences. Overall enquiries rose by 14%, but for homes in the £4-500,000 range this was 49%. They note that London’s outer areas and commuter belt offer the biggest potential tax savings, and this is reflected in the top 10 locations and price bands measured by the increase in enquiries, which is shown in Table 2.
Wider South East Rental Market
Figure 3 shows rental growth data at regional and national level. Rents in the South East and East have approximately tracked the national average. Annual growth in these two regions for June was +1.1% (SE) and +1.6% (E).