The London property market is showing early signs of a resurgence, according to recent data from Rightmove.
The capital experienced a 1.3 per cent increase in property prices year-on-year to January and a 1.8 per cent uplift month-on-month. The latter meant, regionally, it was the second highest climbing market after the North East.
No let-up for first-time buyers
While those already on the property ladder might rejoice at the news of a London uptick, Rightmove also put the city’s average price tag at a staggering £673,483, over £200,000 more than the second most expensive region, the South East, where it’s £469,779. With the price of stamp duty also increasing in April, first time buyers in London will have to save more to get a foot on the ladder.
“Stamp duty charges rising for those buying above £300,000 will be a drag on the important bottom-of-the-ladder market in more expensive areas, unless some additional help for first-time buyers is announced soon,” says Colleen Babcock, property expert at Rightmove.
Outer London leads price revival
If you look at the capital at a borough-by-borough level, Outer London dominates with all but one of the 10 biggest risers being on the outskirts of the city.
Top of the pack is Merton, famous for the green spaces of Wimbledon Common and Morton Hall Park, not to mention the All England Lawn Tennis Club. The average property price is above the London average, at £716,300 and, while it dipped month-on-month by 4.9 per cent, this didn’t cancel out its healthy annual growth of 7.5 per cent.
Part of the appeal may be down to its great connectivity and access to amenities; Merton was recently named one of just seven London boroughs where 100 per cent of its population are within easy walking distance of amenities, such as a library or station, while, according to TFL, the borough boasts five tube stations, eight tram stops and around 445 bus stops.
The second highest London riser is Barking & Dagenham, where house prices are significantly lower than the capital’s average at £378,764. The borough saw a 0.6 per cent month-on-month increase and a 5.3 per cent annual rise, perhaps because it’s been earmarked for a significant amount of development. In October, it was one of seven London boroughs awarded a share of £12.4m to build homes on abandoned brownfield sites. This includes a 20,000-home ‘New Town’ on the site of the former Barking Power Station, which will feature two new schools, a hotel, care home, shops, parks, offices and student accommodation on the banks of the Thames to the east.
Making up the top three risers was Hillingdon with an average price of £570,532, up 1.8 per cent month-on-month and 5.3 per cent annually. Renowned for being one of the leafiest parts – not just of London – but of the whole of the UK, Hillingdon was awarded 70 Green Flag Awards in 2024 and bagged the crown for ‘the greenest council area in the entire country’ in 2023.
The only Inner London borough in the top 10 was Tower Hamlets, which encompasses areas as diverse as Canary Wharf, Brick Lane and Poplar. The borough was 10th with an average property price of £594,253, a decrease of 1.3 per cent month-on-month but an increase of 2.6 per cent annually. The borough is currently subject to a row over whether China should be allowed to build a ‘Super Embassy’ on the site of the former Royal Mint building. There are concerns over security and the protests that the embassy will inevitably encourage.
Inner London prices falling
If you want to secure a Zone 1 pad, now might be the time to invest. Rightmove found that Westminster, where prices average £1,398,520, is the biggest London faller with a monthly and annual drop of 4.8 per cent. With Big Ben and Buckingham Palace among its famous buildings, the borough is a mecca for tourists, but not-so-much for those wanting to make it their home. The borough recently launched an empty homes hotline to crack-down on long-term empty properties used as holiday homes by their wealthy owners.
Richmond Upon Thames, with its famous deer park and celebrity residents including Sir Mick Jagger, Amanda Holden and Tom Hardy, fared badly and was second bottom on Rightmove’s list, with a monthly drop of 4.1 per cent and an annual one of 4.3 per cent, dampening its average £896,828 property price. Property in Kensington and Chelsea has also been dealt a blow this year as its average price of £1,568,103 was a five per cent monthly fall and a 3.8 per cent annual one.
2025 Property Predictions
This latest data supports Rightmove’s predictions that this year marks a turnaround for the capital after a sustained period in the doldrums. “2025 could be the beginning of the price turning point for the London market, with the fundamental pull of the capital for both workers and international buyers predicted to start to reassert itself, helped by some major companies heading back to the office five days a week. Rightmove expects London price growth to be in-line, if not marginally ahead, of national price rises.”
This is a position supported by what Ruislip estate agent Peter Lawrence, Founder at Lawrence Rand, is seeing on the ground: “We have high hopes for a strong year in 2025, with a larger pipeline of sales compared with the start of last year. We expect a solid first three months in exchanges and completions. After the cold snap we’ve just had, viewings, offers and sales being agreed are picking up again at a solid rate. Sellers seem to be listening to our valuation recommendations more than previously, I think this down to expectations being more realistic, and an understanding that mortgage costs are now much higher.”
