Residential real estate in London - statistics & facts

Undeniably, London is one of the most important cities not only in Europe but also globally. With a population of nearly ten million, the megacity is the second biggest financial center in the world after New York, proving its attractiveness to investors, talent, commerce, arts, and culture. Housing in London is substantially more expensive than in any other region in the United Kingdom (UK). Home buyers in 2021 spent on average 200,000 British pounds above the national average for their first home or more than double what a property in West Midlands would cost them.

How much does housing in London cost?

Living in London has its price, and it is a high one. The average monthly rental costs could range from approximately 1,300 British pounds for a home in Croydon to over 2,000 British pounds in areas in the heart of the city – Westminster, Lambeth, Chelsea, Fulham, Hammersmith, and Kensington. Not surprisingly, private renters constitute the largest share of households in London. However, this might change if the number of people who buy a dwelling with a mortgage keeps growing. Yet, properties available for rent heavily outweigh those available for sale. Should one opt for purchasing a home in London, the average monthly costs would be close to 1,400 British pounds. Potential buyers save approximately 400 British pounds monthly from the cost difference of buying over renting but should also be ready to set aside an average of over 130,000 British pounds for a deposit.

Development of rental costs and house prices

While housing in London seems expensive, this can be explained by the high demand, development costs resulting from political uncertainty, climbing construction costs, and the weakening of the British pound. Since the coronavirus pandemic, house prices and rents have increased dramatically, but this trend is likely to change in the coming years. The development of the Index of Private Housing Rental Prices (IPHRP) shows that rents have risen by almost 15 percent since 2015, with the period after the onset of the pandemic experiencing the steepest rental growth. According to an October 2022 forecast, the five-year rental growth for prime properties is to exceed 22 percent. On the other hand, the average price of mainstream housing is expected to grow at a much slower pace and even fall in 2023.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by Statista Research Department, Nov 30, 2022

Key insights

Number of households
3.7m
Number of of homeowners (with mortgage and outright)
1.8m
Number of private renters
1.1k
Get more insights

Editor’s Picks Current statistics on this topic

Average monthly rent in the United Kingdom (UK) in April 2022 and April 2023, by region (in GBP)

Residential Real Estate

Average cost of rent in the UK April 2022-2023, by region

Average flat price and percentage change from the previous year in London (UK) in August 2023, by borough (in GBP)

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Average flat price and annual percentage change in London 2023, by borough

Monthly house price index in London (UK) from January 2015 to February 2023

Residential Real Estate

Monthly house price index in London 2015-2023

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