Prime Central London, one of the top property investment hubs in the world, is registering positive rental growth in view of declining supply levels.
The annual rental value change was 0.9 per cent for Prime Central London properties in September, according to Prime London Lettings Index from international property consultant Knight Frank.
“Some landlords have sold or are trying to sell after recent tax changes and this fall in supply has put upwards pressure on rental values,” Knight Frank said.
The supply of lettings properties has fallen in both Prime Central and Outer London as more landlords sell or list their property for sale. There were 18 per cent fewer listings in Prime Central London in the year to August compared to the previous 12 months.
Broad upwards pressure on rental values looks set to continue in the short to medium-term given the fact that the number of new prospective tenants per new lettings listing has hit a ten-year high. The Prime Central London market is gradually showing signs of recovery.
The Knight Frank report analyses the performance of single-unit rental properties in the second-hand prime central and prime outer London markets between £250 and £5,000+/ week. The index reflects the health of the Prime Central London market, which was negatively impacted by Brexit and recent tax changes.
The percentage of lettings listings in Prime Central London in relation to sales trended downwards in 2017 and the first half of 2018 as more landlords removed their properties from the lettings market and some were sold: Knight Frank