Heard about the ‘exodus’ of people ‘fleeing’ London? Do not be alarmed

Heard about the ‘exodus’ of people ‘fleeing’ London? Do not be alarmed

It has become traditional for the annual release of new population data by the Office for National Statistics (ONS) to spawn media reports of an “exodus” of people from the capital, all of them “fleeing” one or other element of the ubiquitous Bad City narrative: high house prices, crime, foreign immigrants and so on. As usual, a closer look at the picture reveals a less spectacular story.

The focus has been on the outflow of people from the capital to other parts of the UK compared with its reverse – people from elsewhere in the UK moving in to London. The ONS tells us that the number moving out in the year to June 2018 was 304,505 while the number moving in was 237,275. That’s a net outflow of 103,230, and it’s that figure that has stirred recent excitement. Is this justified?

Maybe, up to a point. 103,230 is one of the highest net internal (or domestic) migration outflows this century, but it is not groundbreaking. The net outflow figure for the second most recent figure – year ending June 2017 – was slightly higher at 106,608. Go back through this century and you will find equivalent ONS numbers of 103,133 in 2003 and a table-topping 110,200 in 2004.

As for the lowest totals this century, they were 31,942, 40,344 and 42,559 in the years 2008, 2010 and 2009 respectively. Every other year since 2000 has also seen more people leaving London for other parts of the UK than the reverse. In fact, net internal outflow has been completely routine for decades before that too.

But why the consistent pattern? Why the variations? And why does London’s population continue growing in spite of it?

The answer to the last question is that a combination of net inward migration from overseas and a higher birth rate than death rate within the capital have long outstripped the numbers moving out to other parts of the UK. The new ONS figures show that during the year to June 2018, 201,872 people moved to London from other countries while 89,079 did the opposite – a net inflow of 112,793. That alone outstrips the internal outflow of 103,230, to the tune of 9,563 people.

Meanwhile, London saw 123,594 babies born compared with 50,420 people dying. The difference between these two figures – known as “natural change” –  is 73,174. Add that to the 9,563 and you get an overall population increase of 82,737 during the year in question. As you can see, it’s mostly babies who are responsible…

But what about those continuous net outflows to other parts of the UK and why have those outflows changed in scale?

Economists at City Hall, who, of course, take a close interest in these trends, point out that the ONS data does not include any information about why people move out of London. They do, though, acknowledge that it is to be expected that internal migration follows the gradient of falling house prices. And it is widely accepted that Londoners wanting to move into home ownership will often look at places further from the capital’s centre, where homes are likely to be cheaper to buy, whether in London’s suburban areas or in the Home Counties beyond them.

Similarly, homeowners looking to buy somewhere bigger often move out a travel zone or two, or out of London altogether, often because they have had children and need more room (and the existence of those children, of course, inflates the outflow figure). Other reasons might include seeking a quieter or leafier quality of life; yes, anxiety about crime; or, in the past, access to better schools.

One factor often overlooked in shocked responses to internal outflow figures is that the term “moving out of London” can encompass relocating very short distances, such as from Croydon to Woking or from Enfield to Potters Bar – and such “out of London” places are not only very close to London but very definitely within its wider economic region.

As for the variations in outflow, these can mostly likely be primarily explained by the state of the UK economy and London’s housing market within it. Those three years during this century when net internal outflow was at its smallest – 2008, 2009 and 2010 – also happened to be the three years when the economic crisis was at its deepest. That is probably not a coincidence – everything slowed down, including housing market activity. Looked at that way, the subsequent increases in net outflow might largely simply reflect the economy’s recovery, housing market and all.

Aren’t London’s absurdly high house prices of themselves the chief cause of people moving beyond the Greater London boundary in larger numbers? Isn’t falling affordability simply driving more of them out?

Again, a bit of caution appears wise. It can probably be safely said that recent sky-high prices, both of buying and private renting, will have given greater impetus to a very long term trend. Yet it is also possible that very recent small falls in London house prices have strengthened the outflow current too.

That would be because people who’ve been thinking of selling up and moving out to somewhere larger have finally got round to doing it because the value of, say, their compact three-bedroom terrace in Hendon or Lewisham is suddenly slipping downwards – better to make that move now before it slips down even more. (Private renting, by the way, has become a little less expensive too).

In all, City Hall declines to be alarmed by the latest net internal outflow stats, regarding them as not unusually high but as, broadly, an expected return to pre-crash normality – a premise that informs the draft new London Plan. Just as peoples’ motives for moving are not known with certainty, the outflow numbers are not, of themselves, any more proof of the effects of unaffordability than they are of an improving economy. A GLA economist wrote about this phenomenon in 2016, in response to the media stories of that year about an “exodus” of “fleeing’ Londoners.

Perhaps the most revealing thing about the latest set of internal migration stats is not the difference between the outflow and the inflow numbers – the net figure that has been seized on – but the size of each of them. The outflow figure of 340,505 is the largest so far this century. So is the inflow figure of 237,275. That suggests a rising quantity of population churn, which could be considered bad for neighbourhood attachment and stability. But on the other hand, the overall population has been growing too, so perhaps that’s only to be expected in a city where high churn is the norm. And while a 103,230 net internal outflow looks big, just how big does it look in the context of a city of nearly nine million?

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Categories: Analysis, Intelligence

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