Homebuyers are flocking to the suburbs in search of extra space, resulting in soaring house prices in the most popular towns.
New research by Halifax shows that city dwellers are looking further afield for better value – but some may end up paying more than they bargain for.
Here, Which? takes a look at what’s happening to house prices in the UK’s major cities and their surrounding areas, and offers advice on choosing a place to live.
Race for space sees suburban prices soar
Halifax has identified the UK’s biggest homebuyer hotspots between the start of the pandemic in March 2020 and the end of the stamp duty holiday this June.
It found that house prices in 20 major British cities (excluding London) increased by an average of 8.9%, while areas surrounding those cities saw higher growth of 10.8%.
Halifax says these rising prices reflect buyers heading to the suburbs in search of more spacious homes.
Buyers search for better value outside of cities
For many people, working from home has become the norm since the start of the pandemic, and the promise of hybrid working in the future has given some the freedom to buy homes further afield.
The demand for larger properties with more outdoor space has resulted in buyers moving out of cities to local towns, where they believe they’ll get more property for their money.
Andrew Asaam of Halifax said: ‘It’s clear from speaking to our mortgage customers that many have prioritised space over location as a result of more time spent at home over the last year and a half.
‘We’ve seen evidence of this in areas right across Britain, with house price growth in the vast majority of cities now being outstripped by increases in their surrounding areas.’
City vs suburbs: how price growth compares
Halifax analysed how house prices grew in 20 UK cities compared to their surrounding areas.
The table below shows what’s happened to prices in each city, and lists the nearby local authority that saw the biggest price rise.
Areas with highest suburban price growth
Plymouth registered the biggest disparity between city and suburbs. House prices in the city rose by 6%, but surrounding towns saw growth averaging 16%.
The biggest contributor to the rise was South Hams – home to the exclusive seaside town Salcombe – where prices rose by 26%.
The towns surrounding the Northern cities of Leeds and Manchester also saw significant growth.
Areas where cities are still beating towns
In the vast majority of cases, suburbs outstripped cities in terms of price rises, but there were a few exceptions.
The cities of Sheffield and Liverpool both enjoyed double-digit price growth, above and beyond the rises seen in local towns.
Birmingham, Glasgow and Sunderland were the other three cities that beat out their local suburbs.
How homebuyer priorities have changed
The swathe of buyers moving to the suburbs reflects how priorities have changed since the start of the Covid-19 pandemic, with location and transport links becoming less important.
A survey by the bridging loan provider Market Financial Solutions found that the three biggest priorities for buyers in 2021 were outdoor space, broadband connectivity and the size of the property.
This echoes the findings of a joint study by Share to Buy and Peabody, which analysed what first-time buyers were looking for in homes.
Two thirds (64%) of prospective buyers said a private garden had become more important to them since the start of the pandemic.
Superfast broadband was second in the list of priorities, followed by having open space nearby.
How to find the best place to live
If you’re tempted to up sticks this year, it’s important to remember that the right place to live isn’t just about the property or its price.
Instead, a whole range of work, leisure and lifestyle factors come into play.
It’s important to thoroughly research an area before taking the leap. Think about your priorities – if you like dining out, are there good restaurants nearby? If you prefer exercising regularly, are the gyms any good?
You might also want to consider things like transport connections, pollution levels, services such as banks and GP surgeries, and of course whether the local schools are well-regarded.
Our guide on finding the best place to live contains lots of great tips on how to settle on the best area to buy a home.
