06Local authority-level data points towards a reversal of the pandemic impact

Looking at data for individual local authorities helps untangle this further, and also offers insights into how permanent the changes in behaviour are likely to be.

During 2020-21, all London local authorities experienced greater population outflow. This meant that:

  • ‘Exporters’ (every Outer London authority and four Inner London boroughs) saw their net outflow increase.
  • Some ‘absorber’ Inner London boroughs (e.g. Tower Hamlets) saw their net inflows decrease but remain positive.
  • Some absorber Inner London boroughs (e.g. Camden) became exporters.

Data from the 2021-22 year shows that:

  • In almost all exporter local authorities there was a return toward the pre-pandemic norm: the net outflow in 2021-22 was less than in 2020-21, but still greater than the pre-pandemic average.
  • But out of the 10 absorber Inner London boroughs, six saw net inflows in 2021-22 that were higher than the five-year pre-pandemic average. In Camden, for example, 2,430 more people moved in from elsewhere in England and Wales than moved out, compared to 1,710 in an average pre-pandemic year.

Figure 12 shows visually how net population flows between Inner London boroughs and the rest of England and Wales have changed between 2014 and 2022, highlighting the exporters and absorbers.

Figure 12: Population-absorbing local authorities became population exporters, and then started absorbing again

Source: ONS

These data (the latest available from the ONS) give the first indication that there has been compensatory move-in behaviour in some Inner London boroughs.

Data on rents suggest that this population bounce back has continued. Figure 13 shows changes in local average rents relative to changes in the UK average rent,9 in Inner London absorber boroughs. Broadly corresponding to the data in Figure 12, there were sharp falls in boroughs such as Camden, Islington and Tower Hamlets in 2020 and 2021. All other Inner London boroughs also saw rents fall relative to the UK average.

But since the pandemic, rents have risen to catch up with changes in the UK average. Annual average rent increases to July 2023 of 17, 15, and 14 per cent in Westminster, Tower Hamlets and Camden, respectively, suggest that relative demand has increased dramatically in these boroughs, as compared with the rest of England, where rents rose by ‘only’ 7.6 per cent over the same period. The Inner London population bounce back appears to have continued apace.

Figure 13: Rents in absorber local authorities dropped and then bounced back

Source: ONS

Footnotes

  • 9 This is an attempt to isolate how local demand changed compared to national average demand by controlling for how increased interest rates and changes to landlord tax reliefs may have potentially constrained the supply of private rented properties across the country through the post-covid period. We are unable to control for how local rents are affected by new properties increasing supply locally or localised landlord licensing constraining it.