House-Hunters Are Back in Almost Every English City But London

(Bloomberg) -- England’s house-hunters have raced back after the property industry was released from lockdown. But few of them want to live in London.

In what’s likely to be a short-lived rebound, interest in buying homes over the past two weeks has surged 20% compared with the start of March, according to a report from property portal Zoopla Ltd. released Wednesday. For homes in the capital, however, demand was still 14% below the pre-pandemic average seen throughout February.

The most popular spots for prospective house buyers were southern coastal cities Southampton and Portsmouth, where demand was more than 40% higher.

“The rebound in London has been less pronounced than other cities and could reflect a portion of new demand looking outside the city,” Zoopla said in the report. That might “be a result of the lockdown and people wanting to trade out into commuter towns.”

With millions of the capital’s workers stuck in makeshift offices in bedrooms and living rooms, some may be wondering whether higher London house prices are worth it if working from home remains the norm. Bosses at some of the world’s largest financial institutions have even hinted that the traditional model of employees gathering in one central office could become outdated.

Barclays Plc Chief Executive Officer Jes Staley said headquarters built to house thousands of staff might be a “thing of the past”, while Standard Chartered Plc’s chairman Jose Vinals said the bank would rethink whether 100% of staff needed to be in the office all of the time.

Still, both employers’ and house-hunters’ requirements will largely depend on the coming downturn.

“It is hard to square the rebound against projections for a sharp rise in unemployment and a major downturn in economic growth,” Zoopla said in the report. “We expect the economic impact of Covid to feed through into market sentiment in the near term.”

©2020 Bloomberg L.P.