Rental prices in London are set to increase by an average of 15% over the next five years compared to 10% across the rest of the UK, as the housing market in the capital continues its recovery according to a new report by global property experts Knight Frank.
The company’s five-year rental forecast is that rents will rise by 10% in prime central London and 11% in prime outer London, with greater gains likely in the outer parts of the city.
In terms of the mainstream residential property market, Knight Frank's market forecast 2020 - 2024 is for a 13% hike in propery prices in London, which is slightly less than the anticipated 15% rise across the UK.
However, Knight Frank expects to see property prices in prime central London surge 18%, ahead of 13% growth in prime outer London and an 11% rise in prime regional parts of the capital.
Tom Bill, head of London Residential Research at Knight Frank, commented: “Overall, we are forecasting price growth of 2% across the UK in 2020 and of 15% cumulatively between 2020 and 2024.
“Slightly stronger growth is expected in the South East and East of England supported by a more positive outlook for economic and employment growth over the next five years. Once the Brexit deal is completed, we forecast rising momentum across all markets, with price growth reflecting this from 2021 onwards.
“In prime London markets, the erosion of the currency discount as well as the possibility of stamp duty changes for non-residents will weigh on demand in the short-term. After that we expect stronger growth to return before a dip in 2024, the date of the next scheduled general election.”