UK property market update – More sellers, rising prices & a £100bn London boost

The competition to sell a property is at its highest at this time of the year since 2015, giving buyers the upper hand in terms of choice of properties. However, sellers with sensibly priced properties are finding buyers quickly, as agreed sales have increased by 9% from last year.

House prices continue to grow

Our latest quarterly market index revealed a 3% annual increase in UK house prices that have continued its positive run by growing steadily for the last three quarters. Albeit slower, prices in London have also increased by 0.9% annually. The average house price in the UK is now £302,464; in London, the average is over 92% more at £581,641. According to Rightmove’s latest index, average house prices in the Capital grew by 1.3% (+9,046) from last year.

More sellers coming to market

Rightmove also reported an 8% annual increase in the number of new sellers coming to the market, while sales have increased by 9%. This growth indicates market resilience, as most recent buyers will likely have missed the relaxed SDLT thresholds that expired on 31st March. However, buyers and sellers need to be more patient with a log jam of nearly 575,00 transactions going through the slow-moving conveyancing process.

Pause on mortgage rates globally

The Bank of England (BoE) held its base rate at 4.5% at the last MPC meeting in March. BoE’s decision to keep the base rate unchanged came in shortly after the US Fed and China’s central bank decided to hold their key interest rates amid tariff pressures on global trade. While the US held its key borrowing rate in the range of 4.25% to 4.5%, China’s five-year loan prime rate (LPR) remained unchanged at 3.6%.

The average five-year mortgage rate in the UK is currently at 4.74%, marginally lower than the 4.84% level of this time last year but considerably lower than its peak of 6.11% in July 2023. Inflation levels are currently at 3% and higher than the 2% target set by BoE.

£100bn boost for London’s economy

The Mayor of London, Sadiq Khan, announced a mega £100bn growth plan to boost the UK Capital into a decade of high growth and restore productivity to the pre-GFC era. The devolved funding plan includes allocating over £300m in central government skills funding to local schemes that will help create more than 150,000 jobs. Londoners will also benefit from transport upgrades, including plans to extend the DLR to Thamesmead in the southeast and the proposed extension of the Bakerloo underground line further south to Lewisham.

Directors travel across Asia to meet investors

Our UK Directors, Anita Mehra and Marc Von Grundherr, concluded an extensive Asia tour in the last fortnight of March, wherein they met investors to share key market updates and held one-to-one consultations. Their tour began in Dubai on 15th March, following which they visited Hong Kong and wrapped up in Bangkok. They advised clients on the best investment opportunities in London and the benefits of instructing a professional property lettings and management company.

Thamesmead’s Southmere showcased in Malaysia

Our Malaysia office showcased Southmere, a brand-new lakeside development in Thamesmead, where investors can earn attractive yields of up to 6%. The development is a short walk from the Abbey Wood Elizabeth Line Station with quick access to London’s business districts and well-regarded schools, making it a top choice for working professionals and families.

Dubai, Swiss and London developments showcased in Hong Kong

Our Hong Kong office had a busy month with back-to-back property showcases from across the globe. They started with a preview of Damac Lagoons, a Mediterranean-inspired luxury property development in Dubai. Then, they went on to showcase five-star hotel residences in Andermatt, located in the beautiful Swiss Alps and finally concluded with an exclusive exhibition of the London Square Collection, featuring the developer’s best new schemes in Twickenham, Wandsworth, Nine Elms, and Croydon.

Focus on the Golden Triangle in Singapore

Our office in Singapore showcased a rare opportunity to buy a house in Wandsworth, where only 1% of residential properties are houses. London Square Wandsworth Common is an exciting new development offering stunning three, four, and five-bedroom houses. The team also launched two developments near the top-ranked universities of Oxbridge. Canalside Quarter in Oxford and The Icon at Knights Park in Cambridge offer investors strong growth potential and attractive yields.

RAR and Westminster property showcases in Thailand

Our office in Bangkok showcased beautiful waterfront apartments at Royal Arsenal Riverside in Woolwich, along with several other Berkeley Capital collection developments. They also held an exclusive preview of London Square’s prime central London development, featuring bespoke interior-designed homes with premium specifications.

Rents continue to increase despite moderation

As per Zoopla’s latest rental report, private rents in the UK increased by 3% annually, down from the higher levels of 7.4% recorded last year. However, affordability is still a constraint for many renters, as the annual cost of rent in the UK is up by £3,000, reaching an average of £15,400. The good news is rents are still rising slower than average earnings, which are up 6% from last year. According to ONS, London has the highest annual rent inflation of 9.9% compared to the national average of 8.1%.

Narrowing supply-demand imbalance

With 11% more homes available to rent this year, the shortage of rentals has improved as demand is now 17% lower compared to last year. However, despite the increase in supply, 12 renters are still chasing every available rental home. The price difference between London and the rest of the UK has also widened as the average monthly rent in the Capital at £2,166 is more than double that of the UK average (£1,059. Furthermore, rents are expected to increase by 3%-4% in 2025.

As a leading estate and lettings agent with over 65 years in the business, we have 21 branches across London and 14 international offices to help you find the right property investments and maximise rental returns. Contact us to learn more about property investments.