London House-Price Premium at 8-Year Low as Buyers Look to North

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The gap between London house prices and those in northern England is at its narrowest since 2013 as a pandemic-induced “race for space” sends buyers in search of bargains way beyond the British capital.

Property website Rightmove said Monday that asking prices for homes in Wales, northwest England and Yorkshire and The Humber have all surged by more than 10% since the pandemic began early last year. By contrast, they’ve barely moved in London, where values are now less than three times higher than in the north.

London House-Price Premium at 8-Year Low as Buyers Look to North

The figures show how the crisis is reshaping the U.K. property market, with workers no longer required to be in the office full time taking the opportunity to move away from big urban centers. The strength of demand suggests that the housing market has sufficient momentum to withstand the planned withdrawal of Chancellor Rishi Sunak’s tax cut on home purchases from the end of next month.

“The pandemic has given a greater focus on the home, and in 2020 we saw a surge in southern coastal and rural areas,” said Tim Bannister, Rightmove’s director of property data. “So far 2021 is proving to be the year of the northern mover.”

London House-Price Premium at 8-Year Low as Buyers Look to North

On average, asking prices across the U.K. rose by 1.8% in May to 333,564 pounds ($470,000), leaving them 6.7% higher than in March last year. Upward pressure is being fueled by a lack of properties for sale, which is particularly acute in the north, Rightmove said

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