Our most luxurious residential real estate options may be offering the biggest opportunities for landlords at the moment. Especially considering the wider market is relatively stagnant right now.
The average UK house price fell month-on-month in March, according to Halifax.
This was likely the result of the March stamp duty deadline rush passing. Yet, according to LonRes, Prime London property prices rose annually in February.
This marked the first increase seen since 2023.
Moreover, there was a rise in instruction levels, and a rebound in properties valued over £5m. Also, analysis from Knight Frank shows that even with a probable lull in transactions looming, London’s prime scene very much remains a buyers’ market.
It expects transaction levels to pick up in the summer markets as the impact of the stamp duty deadline fades. The rental outlook also looks promising.
Additional research from Knight Frank revealed that average rents in prime central London rose by 0.6% in Q1 2025 - the largest quarterly increase seen since November 2023.
Also, adding to the buyers’ market here, is the fact that domestic property investors may end up facing less competition from their global rivals.
Hampton’s Spring update found that overseas buyers made up just 1.1% of those registering to buy a home in Great Britain in Q1, the second lowest figure on record.
This could be short-sighted on the international investor’s part. We have seen many prime estate agencies and industry insiders reporting that many people choosing to move to London over its global rivals, such as Dubai, and Switzerland.
The future looks bright for London’s prime BTL market.
In fact, for those who can’t afford the capital’s entry costs, the wider UK prime market also holds plenty of potential.
Savills’ latest research on the residential market showed rental values of prime properties in the UK rose in Q1. Central London growth hit 0.3%, while outside of the capital it reached 1.3%.
Property investors are likely keen to find growth wherever they can at the moment, given all the uncertainty that’s hit the global stage.
Dedicating more of their resources to the prime market may prove worth it, and specialist lenders need to ensure they can accommodate that demand.
