The Prime Central London property landscape is experiencing a significant shift, with growing numbers of high-net-worth individuals opting to rent rather than buy luxury properties. This trend signals a fundamental change in how wealth interacts with the capital's most prestigious postcodes – and begs the question: is high-end renting becoming the new buying?
The Economics Driving Super-Prime Renting
"Super prime rental across London has been noticeable," notes Christian Lock-Necrews, Director of Winkworth Knightsbridge & Chelsea. "Many buyers are shifting requirements due to SDLT changes – the savings often cover several years of rental payments."
This calculation is compelling with Prime Central London (PCL) sales prices declining while rental values rise. Our PCL offices data shows rental applicant registrations for December through February 2025, while slightly lower than the same period in 2024, sit comfortably 12.3% above the five-year winter average and substantially higher than pre-pandemic levels. Interest in premium price bands (£2,000+ per week) remained consistently strong throughout 2024, with notable activity in Q2 and Q3.
The LonRes Winter Market Update confirms this trend, noting "Prime central London was the best performing area for the quarter and the full year, with growth of 4.2% and 7.1%." in the rental market. Meanwhile, sales prices in the same areas fell by more than 4%.
Who Are Today's Luxury Renters?
Hannah Kavanagh-Manners, Lettings Manager at Winkworth Pimlico & Westminster, highlights "More overseas clients relocating to London with exceptionally high budgets." Our offices are seeing substantial interest from financial services professionals, with European and North American renters showing particular growth.
UK and EU nationals comprise 63% of new tenants (with EU nationals being the largest group at 38%), while financial services professionals account for 36% of high-end tenants. Most notably, average tenancy length has reached an all-time high of 26.8 months, suggesting these wealthy renters are making longer-term commitments without buying.
Christian notes American clients often include "those in film and media, under 50, and entrepreneurs with no ties to a particular location," who value London's familiarity while avoiding substantial purchase costs. These profile shifts suggest a growing preference for flexible luxury living over traditional ownership.
Market Performance Across PCL
The available stock ratio pattern in our PCL offices reveals interesting trends. Throughout 2024, high-end smaller bedroom properties (suitable for wealthy couples or professionals) outpaced larger family homes by a considerable margin. The second half of 2024 saw increased availability of premium properties compared to previous periods.
Winkworth Paddington & Bayswater, observes that "Luxury properties with premium amenities remain in demand, though tenants are negotiating more due to increased competition."
Average rents on new tenancies increased by 3.65% in Q4 2024, with renewed tenancies showing even stronger growth at 6.9%. LonRes confirms rental yields have been steadily increasing since 2021, with prime London yields now at 4.56% – significantly higher than the 3.5% mark that prevailed for years before the pandemic.
Market Outlook
Looking ahead, we anticipate continued premium on flexibility, especially as the Renters' Rights Reform Bill progresses through Parliament. Rob Oatley, Director of Winkworth Pimlico & Westminster, notes that landlords with higher service charges are more likely to consider selling because of these reforms, potentially reducing stock and further driving demand.
For those with premium properties in desirable locations, the super-prime rental market offers attractive opportunities. Data shows the average discount to asking price across prime London is just 3.3%, while average time on market has decreased to 65 days in 2024. Vacancy periods have shortened dramatically to 22.2 days on average, with Q4 2024 seeing an even more impressive 6.14 days – illustrating the efficiency and demand in this market segment.
The rise of high-end renting in PCL reflects both changing economic calculations and evolving lifestyle preferences. For a growing segment of wealthy individuals, luxury renting has indeed become the new buying – offering the prestige of prime addresses without the commitment of ownership.
Sources: Winkworth Research, LonRes, PrimeResi, LCP
