Prime central London is forecast to surpass the rest of the country on price increases next year, as buyers look once more to Kensington and Chelsea.
Property sales in lucrative parts of the city will rebound after being hit hard by the pandemic, as international buyers return, according to estate agent Winkworth.
Winkworth chief executive Dominic Agace said: “[Prime central London] has been most affected by the pandemic and it hasn’t gone anywhere for the past six years. There will be significant pick up [in 2022],” he said.
The agent has already marked a 44 per cent increase in applicants for new properties in prime central areas in the last quarter, compared to 2019 levels. This is compared to four per cent for suburban London and 36 per cent for country markets in the last quarter.
“This shows the buzz around properties in central London,” Agace said. “This will lead to price increases in central London outperforming the rest of the UK.”
Traditional areas like Kensington and Chelsea are expected to drive the wider area’s recovery, with six to seven per cent growth forecast.
On the flip side, the estate agent predicted that “we will see the steam coming off” the rural market after the pandemic triggered an escape to the countryside last year.
Agace said: “The country markets will continue at a lower rate, driven by a lack of supply, at around four to five per cent, with suburban London staying steady at three to four per cent, apart from the super suburbs that generally outperform.”
Henry Synge, from the Winkworth office in South Kensington, said there was a “sense of real optimism” as people who chose to “wait and see” are now prepared to make decisions.
“Often seen as a precursor to a strong sales market, rentals were up by 100 per cent this autumn when compared to 2019, and over that period we saw the highest number of agreed tenancies in the past 10 years with the return of the students, professionals and most encouragingly the corporates,” Synge explained.
The market has also benefited from “US executives” returning to the city, Synge added.