London residential market outlook winter 2018/19

Cluttons has released its Winter 2018/19 Residential Market Outlook report.

Average capital values in prime Central London continue declining. On an annual basis, our data shows that average prices are down 6.8%, with no sub-markets registering any value increases over the last 12 months. Even locations in the core Central London areas that surround the London’s golden postcodes have not been immune to this trend (4.6% drop on the same period last year).

Best in class homes continue to drive the market as sales in the luxury segment (homes priced over £10 million) increased by 29% compared to the previous year, mainly driven by the fact that significant price drops across prime Central London have created a perception of fair value, and this helps lift deal volumes in the upper echelons of the market.

At this stage, the main barrier to an improvement in the market is Brexit and the associated uncertainty about Britain’s relationship with the EU once we depart next spring. At the same time, important fundamental issues such as persistent affordability challenges, an ever-evolving residential tax regime and pressure on domestic buy-to-let and international investors has left the market in a relatively consistent state of decline.

Rental stability across prime Central London persists, with values remaining stable once again in Q3 2018. The fundamentals in the lettings market remain strong in general, particularly in London where insurmountable affordability issues, mean that renting for longer is increasingly acceptable and a sought after lifestyle choice.


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James Hyman

Partner, head of residential agency

Head office

T +44 (0) 20 7407 3669
James Hyman, head of residential agency, Cluttons
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