House price growth across commuter belts is outperforming the cities they surround across every major UK location analysed by Yopa.
The estate agency compared annual house price growth across 12 major cities with average growth in their surrounding local authority commuter areas, finding stronger performance outside the city in every case.
The largest divide is in London, where city house prices have fallen 3.7% over the past year while prices across its commuter belt have increased by an average of 0.9% – a gap of 4.6 percentage points.
Cardiff has the second-largest difference, with prices rising 2.9% in the city compared with 6.7% across surrounding areas.
CITY PRICES LAG
Nottingham ranks third, recording a 0.7% fall in city prices against average commuter belt growth of 2.4%.
Birmingham shows a similar pattern, with prices down 0.3% in the city but up an average 2.6% in surrounding areas.
Commuter locations around Glasgow have recorded 5% growth compared with 2.5% in the city, while Manchester’s surrounding areas are up 2.7% against just 0.5% in the city.
The differences are considerably narrower around some other locations. Bristol’s 2.2% growth compares with 3.2% across its commuter belt, while Liverpool has recorded 4.8% versus 5.1%.
Leeds has the smallest gap, at just 0.1 percentage points, with city prices rising 3.7% and surrounding areas averaging 3.8%.
AFFORDABILITY DRIVING CHOICES
Verona Frankish (main picture, inset), CEO of Yopa, says: “Higher mortgage rates have put far greater pressure on buyer affordability in recent years and, while the borrowing landscape has improved, buyers are still having to think carefully about where and how they spend their money.
“For many, stretching their budget to remain within their favourite city may have been achievable when mortgage rates were at historic lows, but today that same decision comes with a considerably higher monthly cost.
“As a result, the commuter belt can provide the next best option, allowing buyers to remain within reach of the city they know and love, while potentially securing more home for their money or simply purchasing at a price that better suits their current borrowing power.
“Our research certainly suggests that these surrounding markets are holding their own, with house price growth across the commuter belt outperforming the city itself in every major city we analysed.
“Of course, this doesn’t mean buyers are turning their backs on city living and in places such as Leeds and Liverpool there is very little between the two markets. But with affordability remaining a key consideration, it’s easy to see why the commuter belt continues to appeal to those who want the best of both worlds.”
