Uncertainty around the UK’s planned departure from the EU and the stability of the government is causing the super-rich to rent instead of buying properties in London.

Knight Frank reports that demand for super-prime lettings, properties priced at £5,000+ per week, has strengthened this year.

During Q2 2019, the agency recorded 40 lettings transactions above the £5,000 per week mark, the highest figure for the period in more than seven years.

In the year to June there were 153 super-prime tenancies agreed by Knight Frank – the highest annual total over the same period.

The agency reveals that US tenants looking to rent in prime London have greater spending power thanks to the weakening of sterling. It calculates that a renter with a weekly budget of £5,000 has seen this grow to more than £6,000 since the EU referendum in June 2016.

Demand from US tenants has increased in Notting Hill and St John’s Wood thanks largely to the quality of schools in these areas, Knight Frank says.

The super-prime lettings report also suggests that high-quality developments have also been driving wealthy renters to areas like Mayfair.

However, supply of super-prime lettings homes is tightening, with Knight Frank’s number of listings dropping to 209 in Q2 2019, down from 284 a year previously.

“People are watching and waiting for the political situation to play out and some have decided to rent,” comments Tom Smith, head of super-prime lettings at Knight Frank.

“People tell me they want to remain flexible, not just because of Brexit but because of their concerns around global trade tensions and the state of the world economy.”

He says a supply shortage, particularly for in-demand new build developments, is pushing up rental values and subsequently providing landlords with yields in excess of 4% – figures which are rare in the prime London market.