Prime London rents are rising

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This is Chubby Wallet. The newsletter that teaches you how to profit from property trends before they go mainstream..

Here's what’s in store..

• General market update

• Mortgage approvals are gaining traction

• Prime rents in London are rising

• The immigrant that went from £20 to 2.5million square feet of Prime London space

The property market is currently like a stock exchange floor overflowing with sell orders - homes are flooding the market, but buyers are biding their time, waiting for the right price to bid…

In June 2025, 756,675 properties were listed, according to Chris Watkin up from 660,000 pre-pandemic and far above the 600,000 of tight sellers’ markets.

This surplus, partly from landlords exiting, gives buyers ample choice.

• New listings: 36,900 per week, 4.7% above 2024’s average and 7.7% higher than pre-pandemic.

• Stock levels: 10% more than the nine-year average (excluding 2020), favoring buyers.

• Impact: Abundant choice keeps price growth in check, signaling a “flat” market.

Price reductions and haggling

June saw 14.1% of properties reduced, with 27,500 discounts in one week, a sign of buyer leverage in a crowded market.

• Reduction stats: 33% more cuts than the five-year average, with one in seven homes discounted.

• Takeaway: Sellers need sharp pricing to compete in this buyer-friendly environment.

Sales activity

Sales are steady e.g A recent week saw 26,600 homes go “sold subject to contract” (SSTC), with most deals holding firm. Buyers are active but selective, keeping the market balanced.

• Sales figures: SSTC up 7.7% year-on-year, 15.6% above 2017-19 levels, close to 2022’s peak.

• Fall-throughs: At 23.7%, below the seven-year average, showing stable transactions.

• Net sales: Up 6% from last year, a strong but not explosive performance.

House prices: stable, not soaring

Prices are holding steady, Halifax reported 0.0% growth in June, after a 0.3% dip in May, with annual growth at 2.5%.

Nationwide noted a 0.8% weekly drop but suggested it’s just noise. Affordability remains tough due to rising living costs, like energy bills up 50% in five years.

• Price trends: Annual growth at 2.5% (Halifax), with inflation-adjusted prices at generational lows.

• Challenge: High living costs strain budgets, despite stable prices.

The effect of government policies

Policy shifts, like stamp duty changes, have influenced demand, though specific impacts aren’t detailed in the data.

Rules pushing landlords to sell are adding to stock, creating a buyer’s market and challenging sellers to stand out.

• Impact: Landlord exits boost supply, giving buyers leverage.

• Long-term: Policy-driven supply increases may ease over time.

Demographic shifts

Population growth and diverse buyer needs sustain demand, First-time buyers are active, per Halifax, but face affordability hurdles, likely relying on family support or favorable lending.

• Trend: Growing population drives housing needs across buyer types

• Challenge: Affordability constraints persist for younger buyers

Affordability: the big hurdle

Common affordability issues persist, with homes costing more than most can comfortably afford.

Rising living costs, like 50% higher energy bills, exacerbate the squeeze, keeping many buyers cautious.

• Issue: High costs relative to income limit purchasing power.

• Impact: Buyers are selective, contributing to price reductions.

What’s next for 2025?

The market should remain steady. Prices are likely to grow modestly (around 2.5%, per Halifax), with stronger gains in affordable regions and flatter trends in pricier areas.

Easing lending conditions will support sales, but risks like economic uncertainty could temper momentum…

Buyers can capitalize on high stock, while sellers need competitive pricing.

• Opportunities: Buyers benefit from choice; rental investments may shine.

• Risks: Economic shifts could slow demand or delay rate cuts.

Advice: Sellers, price smartly; buyers, negotiate wisely.

The mortgage market is picking up steam, like a cyclist finding a smoother road. Halifax’s head of mortgages says:

This is bringing more buyers, especially first-timers, back to the market.

• Increased access: Halifax helped 3,000 extra buyers (including 1,000+ first-timers) qualify for mortgages over two months.

• Sector impact: If scaled, this could mean 108,000 more mortgages yearly, boosting transactions by ~10% and nudging prices upward.

• Rate trends: Average drawn mortgage rates are at their lowest since 2023.

Economic backdrop : mixed signals

The economy is sending mixed messages, like a weather forecast that can’t decide on sun or rain.

May’s GDP dipped 0.1%, missing the 0.1% growth expectation, dragged down by construction (-0.6%) and production (-0.9%).

However, a strong revision to March’s GDP (from 0.2% to 0.4%) and a 0.7% annual growth rate show resilience.

• Sector performance: Services up 0.1%, with information and communication strong; financial and insurance sectors lagged.

• Construction split: Housebuilding and new work (up 0.6%) propped up the industry, while repair and maintenance fell 2.1%.

Bond yields: rising pressures

Gilt and swap yields are climbing, (meaning borrowing costs for the government and lenders rise, potentially pushing up mortgage rates) despite expectations that weaker growth would cool them.

This rise, linked to US tariff concerns impacting UK markets, could pressure mortgage rates.

• Yield changes: 5-year yields rose from 3.982% to 4.051%; 30-year yields from 5.343% to 5.437%.

• Mortgage rates: Best 5-year fixed limited company no-fee rate at ~5.45%.

• Implication: Higher yields may limit rate reductions, affecting affordability.

Lending dynamics

Easing mortgage conditions are opening doors,

Halifax’s support for 3,000 additional borrowers suggests lenders are relaxing criteria, potentially driving a 10% transaction boost

Looking ahead

The market is set for steady progress, However, risks like higher gilt yields or economic softness could cap gains.

Buyers can leverage improved mortgage access. Investors might find opportunities in high-yield bonds or rental markets if demand holds.

Despite headlines hinting at turbulence, London's office market is quietly stabilizing—and even thriving in some pockets according to Colliers Q2 London office report

But where’s the real heat, and what are the risks beneath the surface? Here’s the lowdown.

Demand: big Deals, bigger signals

Demand isn’t cooling as some have suggested.. e.g:

• Take-up surged to 3.2 million sq ft, up 29% QoQ and 17% above the 10-year average.

• Financial giants like JP Morgan, State Street, and Squarepoint inked mega-deals (100k+ sq ft).

• Even LEGO and the LSE are getting involved

• Pre-letting activity jumped 65% above the decade average, signaling strong forward confidence.

Who's driving demand?

• Finance (32%) still dominates, but education (5%) is a dark horse, expanding rapidly thanks to global student demand and high-tech investment.

• Even retail, media, and healthcare are making moves—hinting at a diversification few predicted post-pandemic.

Supply squeeze

You can’t occupy what doesn’t exist

• Overall vacancy rates are falling, especially in the West End (7.3%), which hit its lowest in 18 months.

• Mayfair, Soho, Marylebone, Farringdon, and St James’s all now boast sub-10-year-average vacancies.

• Just 2.8M sq ft of speculative space is coming to market in 2025—that’s not enough.

Interpretation? Tenants are locking in space early—if you wait, you lose.

Investment market: a story of two halves

Here’s where things get nuanced.

• Q2 2025 investment volumes dropped 20% QoQ, yet they’re 17% above Q2 2024.

• West End is still seeing high-value deals (£1bn+ volumes), while City activity slowed.

• Foreign capital accounts for 76% of purchases, with Norges Bank alone committing over £1bn YTD.

Why are investors cautious?

Rising interest rates and global economic jitters are dulling appetite—but fundamentals are strong 👇️ 

• Yields held steady at 4.25% (West End) and 5.25% (City).

• Supply is picking up: £3.9B in stock came to market in Q2, up 80% from Q2 2024.

What’s next? opportunities and red Flags

• Buyers: The next 6 months offer a rare window—pricing is stable, but demand is rising.

• Landlords: Grade A space is the winner—focus on energy-efficient, central assets with character.

• Developers: The lack of new core space is a goldmine waiting to be tapped. Act before everyone else catches on.

Risks

• Interest rates: Any sharp moves from the BoE could spook both occupiers and investors.

• Speculative supply gaps: If pipeline delays continue, we could hit a supply cliff in 2026–27.

• Fringe vacancy: Non-core areas are recovering but still patchy—be selective.

London’s office market is no longer in recovery mode. It’s adapting and moving—quietly towards a new era of growth

Picture this: a teenage boy boards a flight from Cyprus to London with just £20 and a suitcase of dreams. No contacts. No safety net. Just raw hunger.

That boy was Christos Lazari.

At 16, he swapped his sleepy village of Dora for the dizzying hustle of 1960s London.

He washed dishes, waited tables, and studied fashion by night.

Some people dream of a better life. Lazari scrubbed cutlery and made it happen.

And within a few short years, he launched Drendie Girl, a women’s fashion brand that punched far above its weight. London’s high street couldn’t get enough.

But this wasn’t the final act. It was only the warm-up.

The Big Pivot

In the late ‘70s, when most successful fashion moguls were popping champagne, Lazari was poring over property listings.

Why?

Because he understood something most people miss: fashion is trend-driven. Property, when done right, builds generational wealth.

Armed with profits from Drendie Girl and the intuition of a builder’s son, he made his first deal in 1978—a retail parade on Camden High Street, complete with flats above.

It wasn’t glamorous, but it was strategic. Mixed-use, income-generating, and in a part of London with upside.

That one deal laid the foundation for Lazari Investments—a family business, with an obsessive focus on value-rich, underappreciated real estate.

By 1984, he was no longer playing it safe. Lazari went all in, acquiring the Art Deco Shropshire House in Fitzrovia, a bold move that screamed confidence.

Scaling

While others chased “hot” new areas, Lazari doubled down on Central London’s golden postcodes—Mayfair, Baker Street, Fitzrovia, Bloomsbury.

His strategy was simple but brutal:

• Buy undervalued assets in trophy locations

• Reposition them with discipline

• Hold long

• Reinvest relentlessly

• No flipping. No fads. Just compounding.

By the 2010s, he had amassed 2.5 million sq ft of prime space. Six estates accounted for over 90% of his portfolio.

He engineered his own pressure

Rather than coast on cashflow, he reinvested aggressively, often taking on large acquisitions that stretched the business. That self-imposed constraint kept him sharp.

Despite managing a £2B empire, Lazari wasn’t your typical suit.

He personally inspected his buildings, often on weekends. He knew his tenants. He handpicked acquisitions.

In 2015, when he passed, Lazari left more than buildings. He left a blueprint.

Takeaways

• Start small, but think big. His first deal wasn’t sexy. It was smart.

• Use early success as fuel. Fashion gave him capital. Property gave him wealth.

• Concentrate where you understand. He went deep in Central London, not wide across the UK.

• Make your capital uncomfortable. Lazari didn’t hoard cash—he put it to work.

• Stay hands-on. No spreadsheet ever told him what a building smelled like at midnight.

That's it for this week folks. Each week we'll cover strategies, updates and insights to help you succeed in real estate. We love this stuff!

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