here is no doubt that young couples are still in love with London: about three-quarters of first-time buyers in the capital are in a relationship, according to data from property website Rightmove. Yet as people get older and think about having children, new research shows many people are choosing to ditch the capital for smaller, more family-friendly cities.

In a report titled “New Prime Urban Markets”, estate agency Knight Frank has highlighted four locations it thinks are worthy of special attention: Oxford, Bristol, Bath and Cheltenham. It has also compiled a set of data indices charting house price growth, transaction levels and buyer demographics in each of these areas. The results show that for these places, which have the right family-friendly mix of good schools, good infrastructure and a metropolitan atmosphere, the growth in capital values has been astounding.

“Now we’re seeing a lot of younger people moving out of London but they still want to live in an urban environment — they want the schools, the shops; they want to be able to walk to the train station,” says Oliver Knight, a research analyst at Knight Frank.

The most remarkable thing, he adds, is that with the exception of Bath, each of these areas has “outperformed prime central London over 2014”. In a year when prime prices in prime central London rose 5.1 per cent, prime prices in Bath increased 5 per cent, Oxford 6.1 per cent, and Bristol and Cheltenham both 6.8 per cent.

Much of this activity is fuelled by incoming buyers who are mostly young (46 per cent of buyers in these areas are still in their 40s) and, notably, from the capital. In Oxford last year, according to the research, sales to outsiders accounted for 52 per cent of the total (18 per cent were from London). In Bath, buyers from London made up 22 per cent of sales, linked largely to the electrification of the rail line to Paddington — due by the end of 2016 — which will cut journey times to the capital by more than 20 minutes, to just over an hour.

Oxford

A recently built, Victorian-style home with seven bedrooms and 6,000 sq ft of living space, about a mile north of Oxford city centre. The house is on sale through Carter Jonas for £4m

“With some London properties going up 50 per cent in value over the past few years, people are realising that if they sell now, they can get a lot more for their money,” says Knight, who says that a sizeable, five-bedroom house in Bath would cost about £1.3m — less than a third of the price of a similar property in prime central London.

“We started to notice places like Bristol and Bath were punching above their weight in the early 2000s,” says Yolande Barnes, director of world research at Savills. She adds other names to her list of “uber-towns”, starting with Cambridge — left off by Knight Frank — and including Canterbury, Guildford and Winchester.

Cheltenham

A seven-bedroom townhouse in Bayshill Road, Montpellier, near the town centre, offers stylish living in an elegant setting. It is on the market for £1.67m through Kingsley Evans

“There has been a distinct shift, and now people are feeling safer investing in places away from giant global cities such as Paris and London,” she says. “Charlotte and Durham, in North Carolina, for example; and then there’s Austin in Texas, and Dublin and Berlin in Europe.”

Back in the UK, agents have noted the same trend. David Mackenzie, head of Carter Jonas’s branch in Bath, says: “We’ve seen a lot of people who perhaps made their money in London or overseas looking to Bath to bring up their families.” In fact, Mackenzie goes further than Knight Frank’s figures, estimating that London buyers account for nearer 40 per cent of his local prime sales. “You get the best of both worlds [here], you can be in the centre of town and have the buzz of being in London, with coffee shops and restaurants, and in 10 minutes you’re walking through a field overlooking an empty valley.”

Bristol

This five-bedroom Georgian townhouse in Harley Place, Clifton, is just a short drive from the city centre. The Grade II*-listed property is available for £2m through Hydes

Although Oxford, Bristol, Bath and Cheltenham might fit neatly into the new prime urban category, house prices still vary wildly. An average three-bedroom house in Oxford costs a little under £744,000, compared with £445,000 for a similar property in Cheltenham. In Bath the price would be about £650,000, in Bristol £550,000.

“They are all very different,” says Knight. “But they have similar drivers: good schools, a good cultural offer and attractive, period housing — and that’s what I think sets them apart.”

Buying guide

Bath

A Georgian terrace house with five bedrooms. This Grade I-listed property is based in The Circus overlooking the city centre. It is on the market for £4.25m via Knight Frank

What you can buy for £1m . . .

Oxford

A three-bedroom, semi-detached house in Jericho, near the city centre

Cheltenham

A five-bedroom, Regency townhouse in the centre

Bristol

A four-bedroom, Edwardian house in Clifton, an affluent suburb

Bath

A pretty, six-bedroom townhouse, a short walk from the city centre

Illustration by James Fryer

Photographs: Marcus Newey; Walter Dirks