London Briefing - what investors should know about sales and rentals

Growing confidence in the property sales market and lower mortgage costs led to a 21 per cent increase in the number of house hunters submitting offers for properties, according to data from London estate agency Chestertons.

The agency’s information, comparing January to the same month last year,  also shows that 17 per cent more properties were put onto the market for sale and seven per cent more owners have requested market appraisals, signalling that more people are now ready to start or resume their plans to move home.

Matt Thompson, Chestertons’ head of sales, says: “The boost in buyer activity is exactly what many sellers have been waiting for. Buyers have become increasingly confident since December, when interest rates were held at 5.25 per cent and mortgage rates started to come down.

“This sentiment carried through to January and with more properties now on the market, we expect to see increasing numbers of buyers, additionally driven by pent-up demand from those that did not feel comfortable moving forward with their search last year.

“We are seeing all types of buyers now entering the market, including first-time buyers, young couples joining forces to achieve a joint upgrade and people that live outside of the capital and require a pied-à-terre to avoid lengthy daily commutes.”

Meanwhile on the rental front the capital is suffering an oversupply of properties- with rents dipping as a result.

The Home website, which produces a monthly =index, shows positive annualised growth in all regions except Greater London.

The capital has seen a 3.4 per cent year-on-year fall in rents and Home’s latest report notes: “Growth in the capital has become increasingly negative overall and a total of 13 prime boroughs now show year-on-year falls in asking rents, up from 12 last month. The worst performer is Kensington and Chelsea with a year-on-year decline of 11.9 per cent.”

UK-wide average asking rents are now 3.9 per cent higher than in February 2023. The North East is now the regional leader in rental growth, surging 14.1 per cent year-on-year.