It is well documented that since the credit crunch, the gap between house prices in London and the rest of the country has continued to expand, with values in London experiencing strong growth.
Average house prices in London are currently 2.3 times the UK average, the largest differential since records began in 1973, according to Nationwide. This has led many households currently living in the capital to face a choice: do they accept a twice daily train journey, commuting costs and hassle in return for more affordable house prices and lifestyle benefits?
Land Registry sales from 2015 suggest that there was an average saving of £3,048 per additional minute of commuter journey time from London. Our analysis of over 300 stations outside London, on direct commuter lines into the capital, shows a clear price differential the further you move out of the capital. The average house price in inner London is £606,000, but by comparison, commuter locations within half an hour’s train ride from London have an average property price of £458,000. Further out the average price is just £337,000 for those with a journey time between 60 and 69 minutes.
Of course, any house price savings must be set against the cost of commuting. An annual rail and underground season ticket now costs from £2,400 to nearly £10,000, depending on length of journey and rail provider. Despite this, savings on house prices will more often than not outweigh the travel costs.
We have already seen an increase in the number of households making this trade off and moving out of the capital. Analysis of Savills buyers in the London commuter belt shows 30% of sales over the first quarter of 2016 were to those relocating from London compared to just 23% during the same period in 2015. We expect this trend to continue as the ripple effect continues to take hold.
The interactive map below shows the key statistics including house prices, journey times, and season ticket costs for commuters travelling in from train stations with good connections to London.