Annual rental growth in July was 9.1 per cent across prime London according to LonRes.  

This figure took rents to 28.4 per cent above their 2017-19 pre-pandemic average; all areas and sub-markets have seen similar levels of growth but what LonRes calls the ‘prime fringe’ recorded the highest annual rise of 12.3 per cent.

Rental market activity in the prime London enclaves remained low in July, with an annual fall of 23.5 per cent in lets agreed and a 5.3 per cent fall in new instructions.  

Overall, despite continuing high demand the stock of properties available to rent appears to be starting to recover from its low base.  

At the end of July there were 25 per cent more rental properties available across prime London than a year earlier, but this remains around 57 per cent below the typical pre-pandemic level for this time of year.

Commenting on the findings Nick Gregori, head of research at LonRes, says: “The prime London lettings market saw a slight increase in available stock in July but this is off a low base.  New instructions fell in July but agreed lets fell more.  In general demand is still strong, particularly for more affordable properties.” 

On the sales side, LonRes reports that July saw activity and values falling across the prime London sales market.  

Achieved prices were 2.6 per cent lower than July last year, continuing the trend of limited significant movement in either direction since late 2021.  Transactions in July were 26.1 per cent lower than the same month last year, and 9.1 per cent lower than the 2017-2019 pre-pandemic July average.

Sales market leading indicators also point to a slower market, reversing some of the positive signs from last month.  

The number of properties under offer in July was 30 per cent lower than a year earlier and new instructions were down 12.4 per cent on the same basis.

The £5 million plus market continues to behave differently to the main prime London one, but there are signs that it too is slowing after a strong 2021 and 2022.  Sales in July fell compared to last year, by 24 per cent, but activity remains significantly higher than pre-pandemic levels, by over 40 per cent.  

New instructions in this market continue to grow and fall throughs and price reductions are rising.