Prime central London property prices in October grew at the fastest rate since September 2015, while prime outer London reached levels not seen since February 2016, property firm Knight Frank revealed Friday.
Prime central growth was a relatively modest 1.2 per cent, but the capital's premium property brokers believe it is the start of a new chapter after the travails of first Brexit and then the coronavirus pandemic put a combined squeeze on prices.
“[The] prime London property market is resuming an overdue recovery that was interrupted by the pandemic,” said Tom Bill, head of UK residential research at Knight Frank.
For those hoping the recovery will follow the “dramatic double-digit bounce-back” from the 2008 global financial crash, Mr Bill sought to moderate their expectations.
Overseas travel restrictions have only recently been lifted and he said it would be next spring that things were likely to feel more normal.
Nonetheless, the green shoots of recovery do appear that little bit longer and greener as the year plays out, with September marking the sixth consecutive month of annual prime central London growth.
The positive outlook for prime central London extends to prime outer London too, an area less affected by tax changes, political volatility or international travel restrictions, according to Knight Frank.
Annual growth was 3.1 per cent in October, the fifth time this figure has been recorded over the last six months. The last time growth was stronger in prime outer London was in February 2016, highlighting the continuing strength of demand for space and greenery.
The fact growth in London's outer ring is almost triple that in its nucleus seems to corroborate a forecast made by Knight Frank in September, when it predicted property prices in prime outer London would grow by nearly 4 per cent over the rest of 2021, double the rate of prices in prime central London.
London's prime market also appears to have coped better than feared with the complete withdrawal of the stamp duty holiday at the end of September.
Knight Frank data showed the number of sales instructions in October were 7 per cent below the five-year average in London, compared with a drop of 14 per cent elsewhere in the country.
The trend can be partly assigned to supply levels in London proving more resilient than in the rest of the UK.