According to the UK House Price Index, property prices in the capital surged by approximately 62% between 2010 and 2016, but the growth slowed significantly in the past six years due to a boost in supply in 2017 and the effects of the COVID-19 pandemic, which triggered a demand for more spacious properties. However, the second half of 2022 saw this city's property market showing signs of recovery. Despite a modest increase of 3.8% in property prices in 2021, our UK Real Estate Report indicates that buyers spent a record-breaking £11.6 billion on London properties in 2021, representing a 45% YoY rise. Consequently, the market saw a growth of 3.34% in the last six months of 2022, matching the performance of the overall UK market.

London's property market had been stagnant, but recent trends suggest a renaissance with experts projecting continued growth in the next decade. This growth will occur as the market self-corrects, individuals return to the city, and the demand for properties surpasses the supply, exacerbating the "race for space" trend.

So, what are the expected changes in London apartment prices in 2023?

 As renters return to urban areas with offices reopening and the city coming back to life, apartment prices in London are reflecting this trend. As of now, apartment prices in London have increased by 4.99% over the past 12 months, resulting in an average price increase of around £21,235. JLL projects that this city's property values will rise by 23.5% over the next four years, indicating that apartments are poised to benefit significantly from this widespread increase. Therefore, it is expected that London apartment prices will continue to rise in 2023.

In addition to the positive outlook for 2023, there are other tangible benefits to investing in London property. One of the most significant advantages is the increasing employment rates across the capital as employees return to the office, contributing to rising demand for London properties. Between February and April 2021 and 2022, the employment rate rose by 0.7% according to the ONS Labour Force Survey. This benefits buy-to-let investors, as new employees typically have higher disposable income and prefer to live near their workplaces, which in turn drives up the prices of this city's properties.

Moreover, London's pricey property market makes it difficult for first-time buyers, so renting is often the only viable option for those who want to remain in the city. As a result, the demand for high-quality rental accommodations continues to rise, contributing to the success of investing in this city.

Finally, London has always been a popular market for investment, with property prices historically weathering external challenges. For investors, a London property remains a relatively low-risk investment and has the potential to offer exceptional returns based on past performance.