The story of falling sale prices in prime central London has become familiar in the past year; now Knight Frank reports that rents are still falling, too.

The agency reports that average PCL rents dropped 2.5 per cent year-on-year in October, the smallest since May 2016.

However, it claims that the number of new prospective tenants registering between January and September this year increased 17 per cent and viewing levels were 22 per cent higher than last year.

The number of properties coming onto the market between January and September was just one per cent higher compared to the same period in 2016.

Supply levels have started to moderate for two reasons, says Knight Frank.

First, while a degree of uncertainty persists in the sales market, volumes are stabilising as asking prices are reset to reflect higher transaction costs, which means fewer would-be vendors are choosing to rent out their property instead of selling.

Second, the figures also reflect a spike in new stock that followed the introduction of the additional rates of stamp duty in April 2016.