The average rent in central London rose 0.7% from February to February, while Prime Outer London rose 1%, Knight Frank reveals.
The increase in rentals in February is less dramatic than three years ago, when growth in two parts of the capital was close to 20%. 
Supply has been rising since then, but Knight Frank says there are indications around future legislative changes that tension is affecting landlords' feelings.
Future tenants' rights bills include proposals that could make tenants more difficult to evict, and pose risks regarding the collection of rental income.
In addition to this, landlords should weigh their options against the background of the green law, rising mortgage rates, and lower succession tax rules introduced within the budget.
The number of new rental lists at Prime Central and Prime Outer London in February was 12% higher than three years ago, but 5% lower than last year's same month, right move data shows.
Knight Frank suggests some hesitation among landlords. This will maintain or increase the upward pressure on rent.
Independent real estate institutions revised their own rental value forecast in November due to 3.5% legislative uncertainty and expected growth in both markets this year.
In terms of demand, the number of new future tenants in London to register for the first two months of this year is 1% higher than last year, with the number of tenants increasing to the same amount.
Meanwhile, the number of super prime tenants for the six months from February to February was 9% higher than the same period 12 months ago.
Demand for companies is also stronger than last year. The number of inquiries from companies at Wretting Properties in the UK was 18% higher than in February 2023.
The relocation of businesses to London and surrounding areas is usually from the energy, finance, professional services, legal and technical sectors.
“We're looking forward to seeing you at Knight Frank relocation and corporate services,” said John Hunpris, head of Knight Frank relocation and corporate services. Although stocks are lacking in some low value markets. ”
“Tenants hope that supply will remain as stable as demand for the remainder of the year.
