London's exodus hits a new high! High mortgage rates squeeze locals.

Homebuyers hope to reduce their borrowing costs by opting for more affordable properties,What is a dealer but the rising mortgage rates in London are forcing more and more people to leave. According to the latest data from Hamptons, a record 30% of the people leaving London this year are first-time buyers.

The major reason for the mass exodus of first-time buyers is the soaring mortgage rates, with the two-year fixed mortgage rate last month climbing to its highest point since 2008 at 6.7%, and the average rate for a five-year fixed mortgage rising to 6.17%. For thousands of Londoners, the increase in mortgage rates means they are facing an extra annual expense of £12,000, with the typical mortgage holder's monthly repayment expected to increase by £220.

Hamptons data reveals that, so far this year, Londoners have purchased 32,600 homes outside the M25, accounting for 7.7% of all property sales outside London. The average spending on property by these people in areas outside the M25 is £429,800, which is £96,590 less than the average in London.

85% of those leaving London have chosen areas with lower housing prices, meaning lower mortgage repayments. For instance, a typical first-time buyer with a 15% down payment could save £8,656 in mortgage repayments annually by buying outside London. Hamptons data indicates that by moving to areas with lower housing prices, these individuals opt to borrow less or even pay off their mortgages early.

Hamptons estimates that if the high mortgage rates persist, this year could see 53,780 Londoners permanently leaving the city, a number nearly equal to the total number of homes sold in Wales in 2022.

Aneisha Beveridge, Head of Research at Hamptons, states that the rising mortgage rates are forcing an increasing number of people to leave London, and the future might see even more departures due to the pressure of high mortgage rates. Those who bought homes during the peak housing prices from 2014 to 2016 might consider moving out of London in the coming years.

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