The London residential property market, a global real estate hotspot, continues to grow substantially, backed by strong demand for rental homes and owner-occupier homes. An influx into the capital is being supported by growth in prospective buyers, tenants and corporate relocations with prime and super prime residential assets attracting significant interest. 

Prime central London (PCL) real estate experienced a 116 per cent uptick in the number of offers accepted over the course of November. This figure was 25 per cent greater than last November (2020) and representative of a ten-year record high, according to research from Knight Frank. The prospective buyer to supply ratio also peaked in PCL and prime outer London (POL) growing from 6.1 to 10.9 in POL in one year, and from 3.9 to 7.8 in PCL. 

The rental sector in the UK capital has also trended upwards with rental values rising 5.3 per cent in the three months leading up to November in PCL and 5.1 per cent in POL. Such a large quarterly POL markup has not been experienced since March 2004; and not since September 2010 for PCL. This correlates with stronger demand from students, offices, and a reduction in short-lets.

The supply of prime and super-prime homes is still at a standstill with Chestertons’ data indicating that prime rental home inventory available in mid-October was 73 per cent down relative to the first month of lockdown in 2020. Moreover, Knight Frank data shows that market valuation appraisals in November were 46 per cent less than the February peak - this reveals the extent to which supply is now reduced. 

The ramification of the spread of the Omicron variant of Covid-19 is still relatively unknown. Industry predictions suggest that so long the severity of Omicron is comparable with (or lower than) Delta, demand should continue improving from January 2022 following the annual seasonal lull over the course of the festive period.