Work in London – Live in Wellingborough

Posted by Ben Ryland in Mortgages on 28 September 2016 - Ben is a Senior Credit Analyst at checkmyfile.

Living in London is becoming more and more difficult for those who work there. This isn’t anything new, as our nation’s capital has a massive problem with providing affordable housing for Londoners who simply want to live in the city they work in. Yet as property becomes even further out of reach for many Londoners in the city, people are relocating further and further afield in order to combine affordable housing, and a reasonable cost to commute back into London.

The Northamptonshire town of Wellingborough has now been identified as the most affordable commuter town for Londoners. The average house price in the town is around £183,345 and the towns train station is less than an hour’s commute into London St Pancras, making Wellingborough a hot spot for Londoners to afford their own home and still reach work in London in a reasonable amount of time.

The scale is staggering when you consider that the average house price in London is £740,000.

Many Londoners are finding they are having to move further and further away from the city in order to be able to afford a home. Towns an hour away by train are the most desirable as the commute (and cost involved) is worth it for the savings which can be made when buying a property. This has seen towns such as Rugby and Sittingbourne, as well as Wellingborough seeing a strong interest in property purchases from Londoners moving out of the city.

This trend is showing no signs of slowing either, with Lloyds Bank reporting that average house prices at an hours commute from the capital are 60% cheaper than within London itself.

Of course, the further out of London you move the more expensive the commute becomes. An annual rail ticket from Wellingborough to London St Pancras can cost almost £5,000. But for many home buyers this is a cost worth incurring in order to be able to afford their own home outside of London.

If the thought of being stuck on the train for an hour (and probably more with the inevitable delays) just doesn’t appeal to you, how about a 40 minute commute to closer commuter towns? Hatfield, Billericay and Reading are a few of the closer towns where Londoners looking to buy could settle down. The house prices are more expensive though with averages around £389,000 as you are that bit closer to central London.

London’s high internal prices are not reflected across other major cities in the UK. In both Birmingham and Manchester it is more expensive to live outside of the city than to live within its limits. Every city will have its pricey areas and there has to be a degree of generalisation, but the pattern shows that London aside it is often more expensive to live outside and commute in than to live in the city itself.

The average house price in Birmingham is £172,000, but several of the city’s 40 minute commuter towns including Leamington Spa and Coventry have higher average house prices over £210,000. Add on to this the cost of the annual rail ticket to commute into Birmingham and it becomes even more expensive to live outside the city.

Andrew Mason, of Lloyds Bank Mortgages, says, “Commuters to London who don’t mind a longer journey between home and work could reap the financial benefits of living outside of the capital.

“However the decision of whether to live in the city or further away is not simply a trade-off between financial costs and journey times.

“Quality of life is also a major factor: family circumstances, better schools, physical environment and homes that offer better value for money also come into the equation.

”That explains why, especially outside London, commuters are often prepared to pay a premium to commute when they could be better off in purely financial terms living closer to their place of work.”

Affordable housing within its city limits, remains one of London’s biggest challenges. But for the meantime it seems that Londoners will still be tempted to seek out cheaper alternatives in commuter hotspots including leafy Wellingborough.

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