London’s population has fallen. That should worry Andy Burnham.

London’s population has fallen. That is a sentence we do not get to write very often. According to the latest ONS mid-year population estimates, London’s population fell by 26,737 people in the year to mid-2025, a decline of 0.29%. London was the only English region to record a population fall. Aside from the pandemic years, this is the only time this has happened since the 1980s.

What’s really happening to London’s population?

At first glance, the story seems obvious: people are leaving London. London had net internal migration of -131,961 in the year to mid-2025, meaning far more people moved from London to the rest of the UK than moved the other way. This is not a new trend. More people have left London for the wider UK than have moved into the capital since 2012. What’s changed is the scale, the gap widening from 50,444 in 2012 to 131,961 in 2025.

However, this has been more of a long-term shift rather than a sudden, new exodus. Net internal migration has been at broadly similar levels since 2022.

The more immediate reasons London’s population fell in 2025 was falling international migration. In the years after the pandemic, international migration drove big increases in London’s population. Net international migration was 182,661 in 2022, 235,320 in 2023 and 156,048 in 2024. In 2025, this fell to 51,839, below the level which would offset the number of people leaving London for the rest of the UK.

Births are still higher than deaths, which matters given concerns about falling fertility rates in the capital and across the country. But natural population change has fallen too. In 2012, births minus deaths added 86,067 people to London’s population. In 2025, it added 54,211, a fall of almost 32,000 people.

This drop in population isn’t a statistical blip, and it hasn’t come out of the blue. It has fallen because several long-running trends have collided: more people leaving London for the rest of the UK, fewer births adding to the population, and a sharp fall in the international migration that had been masking these pressures.

Why is London’s population falling?

These trends matter because they tell a wider story about the challenges facing the city. Earlier this year, Centre for London published Hollowing Out London? Families and Neighbourhood Change in the Capital. We found that spiralling housing costs, childcare costs and the wider cost of living are changing where families can afford to live in London.

The number of households with children in London grew overall between 2001 and 2021, but the geography of family life changed dramatically. Families have become less common as a share of the population in inner London, while some outer London boroughs have seen large increases. Declining birth rates and rising house prices are central to this shift. London house prices are around double the English average, and childcare costs are the highest in the country.

The trends we’ve identified among families are therefore part of a wider challenge: the growing difficulty of building and sustaining a life in the capital. For many Londoners, finding a decent and affordable home – to rent or to buy – feels out of reach. The result is that some people leave to build a life beyond the M25, while others delay plans to grow families, or decide against moving to the capital at all.

Does a drop in London’s population matter?

This should worry policymakers. London’s economy matters to the whole country. London is home to around 15% of the UK population but accounts for around 25% of economic output. It provides 6.5 million jobs and contributes £4 in every £10 of UK tax revenue.

But London’s productivity growth has fallen sharply since the global financial crisis, from an average of 3% a year between 1998 and 2007 to just 0.1% from 2007 to 2021.

That makes London’s growth model more fragile. If productivity remains weak, slower population and workforce expansion make it harder for London to keep growing. And when London’s economy slows, the consequences are felt across the UK.

There is a social warning here too. London’s success has never just been about economic output. London is a leading global city because people come here to build lives: to work, study, start businesses, raise families, create culture and participate in public life. If more people feel they have to leave to find a decent home, enough space, affordable childcare or a liveable cost of living, or decide not to come at all, then London becomes a less open, less mixed and less dynamic city; it starts to hollow out.

London’s population falling for one year is not, on its own, a crisis. But it is a warning that the city’s long-running pressures are now showing up in population trends.

For years, London has continued to grow despite its housing crisis. The latest data suggests that cannot be taken for granted.

How can London, and the UK, reverse the trend?

If the new Prime Minister wants London to “remain the world’s greatest capital”, then a fall in the city’s population should be a wake-up call. National policymakers need a plan for London.

The government’s new devolution agenda is a welcome start. Giving mayors a share of income tax receipts, a larger stake in business rates, and stronger powers over housing, transport, skills and public services recognises something Centre for London has argued for years: places need the tools to shape and grow their own economies.

But London must not be left with a scaled-down deal because of its size or national role. The capital’s challenges are large, complex and nationally significant. Its devolution settlement must reflect that.

Housing will be the test of whether this is a serious deal for London. As we set out in Delivering the Homes London Needs, the city’s housing crisis will not be solved by marginal changes. London needs more social and affordable homes, a fully devolved and more flexible London Social and Affordable Homes Programme, stronger regional investment tools, and the ability to reform the taxes that shape the housing market.

Stamp Duty and Council Tax are broken across the country, but they do particular damage in London. Almost all property transactions in London now incur Stamp Duty, which makes it more expensive to move and harder for people to match their homes to their needs. Meanwhile Council Tax is still based on 1991 property values and is highly regressive, with a renter in Croydon facing a similar bill to the owner of a mansion in Chelsea.

Centre for London has called for both to be replaced with a partially devolved Proportional Property Tax, giving the GLA and London boroughs the ability to raise and reinvest revenue in social and affordable housing. Our model, from our report Delivering the Homes London Needs: What will it take? would:

• Raise £912m for social housebuilding, enabling London to double the number of new social homes it can deliver.
• Reduce costs for first-time buyers and renters, while ensuring those living in larger, higher-value homes contribute their fair share.
• Preserve councils’ rate-setting powers, ensuring we continue to move forward on devolution rather than taking a step back.

This comes alongside a package of 17 recommendations created to ensure Londoners are able to access the homes they need.

These ‘major’ recommendations will need to sit alongside a series of additional policy decisions – on childcare, immigration, crime, transport and many other issues. But the overarching vision for policy needs to be to build a liveable city: one where people want to visit, want to stay and are able to raise a family.

Conclusion

London’s population fall should not be dismissed as a temporary anomaly – or worse, a “good news story” where London’s loss is the rest of the country’s gain. It is a signal that the city is becoming too hard to live in for too many people, and proof that serious change is needed for the capital and the rest of the country to thrive.

A robust response from the new Government would give the capital the powers to build more homes, invest in infrastructure, reform broken property taxes and remain the capital city that drives the prosperity of the UK as a whole.