Nestled in the heart of Northwest London, Kensal Rise is a vibrant neighbourhood offering a unique blend of historic charm and modern amenities. The area's rich history is evident in its Victorian and Edwardian architecture, with many period homes having been restored to their former glory. Alongside these classic properties, the area has seen a rise in new developments, catering to the diverse needs of its residents. From young professionals drawn to the area's social scene and excellent transport links to growing families looking for green space and outstanding schools, Kensal Rise is an appealing choice for those seeking a balance between convenience and community.
The last 18 months
The average price of a property in Kensal Rise and Queens Park dipped by 7.1% over the last 12 months, with prices remaining 16.2% higher than in 2019. This slight decrease is in line with the broader London market, which experienced a slowdown as higher mortgage rates and broader economic uncertainty took their toll in 2023.
Since 2019, the average price of a house in Kensal Rise and Queens Park has risen by 21.8%, outpacing the 6.6% growth seen in flat prices. This trend reflects the "race for space" seen across the country post-Covid, with buyers prioritising larger homes and outdoor spaces.
More recently, however, affordability issues have come to the fore. While larger homes have seen a slight dip in value recently, smaller properties have weathered the storm better, as buyers downsize their expectations in the face of higher borrowing costs.
Consequently, fewer homes sold above the £1m mark in the area last year. 28% of homes in Kensal Rise and Queen’s Park sold for seven figures in 2023, down from a record 31% in 2022 when larger homes were in high demand.
The longer-term picture
Since 2008, which marked the beginning of the current cycle, property prices in Kensal Rise and Queens Park have more than doubled, rising by 101.3%. This growth has outpaced the wider London market, which saw an 89% increase over the same period. The area's popularity among prime central London leavers, particularly post-Covid, as well as its strong transport links and excellent amenities, has supported prices during the last five years, with values rising by 33.7% since 2014.
Rising rents
Rents in Kensal Rise and Queens Park have seen significant growth, rising by 22% between 2019 and 2024. The average rent on a newly let property now stands at £2,478 per month, up 31% since 2016.
This strong rental growth has come at a time when property prices have fallen, boosting yields for investors. The average new buy-to-let in the area achieved a record gross yield of 5.7% in 2023, up from 4.3% in 2019 and 5.1% in 2022.
What's next?
Mortgage rate falls over the last 12 months are starting to stabilise property prices both locally and across London. We might even see a little bit of growth in London this year, where prices took a bigger hit in 2023.
Meanwhile, lower landlord costs as rates fall combined with stretched tenant affordability should slow the pace of rental growth in 2024, but the longer-term supply issue will keep rents rising faster than pre-Covid levels and outpacing inflation. We forecast rents to rise 8% across London in 2024, outpacing the rest of Great Britain.
Looking ahead, we anticipate that rents will rise over four times faster than house prices between 2023 and 2026, further boosting yields for investors. The future of mortgage rates will have a significant bearing on house price growth, with a gradual fall in rates potentially leading to a return to growth from 2025 onwards. We expect London to lead this recovery as the beginning of a new cycle dawns.
