The February 2026 read of our London factor model shows a quality-adjusted market that has pushed sharply higher over the last three months even as the underlying repricing factors have moved in the opposite direction. Baseline Market is up +9.2% since November 2025, but Floor Area contributed -5.9% and Energy Rating -4.4% over the same window. The 12-month picture is far quieter: Baseline Market is up just +0.4% year-on-year, with most secondary factors sitting inside ±1.5%.
The table below summarises the 12-month geometric return per factor (Feb 2025 → Feb 2026). All figures are quality-adjusted from a rolling 3-month cross-sectional regression on HM Land Registry transactions merged with MHCLG EPC data.
| Factor | 12-month return | Interpretation |
|---|---|---|
| Baseline Market | +0.4% | Quality-adjusted London price level is effectively flat over the year, despite a strong recent 3-month move of +9.2%. |
| Floor Area | -3.5% | The premium paid per additional square metre has compressed; larger units are relatively cheaper. |
| Flat Premium | -1.5% | Flats have continued to underperform houses on a like-for-like basis. |
| Room Count | +1.0% | The room-count factor added a small positive contribution over the year. |
| newbuild_geo | +1.0% | New-build locations picked up a small premium over the year. |
| Energy Rating | -0.5% | Small negative pull over 12 months, but a sharp -4.4% reversal in the last quarter. |
The 3-month window is where the interesting divergences sit. Baseline Market's +9.2% jump is the strongest three-month reading since the post-2021 rebound, and it is running against Floor Area's -5.9% and Energy Rating's -4.4%. In other words, headline London prices have moved up, but the market is paying less per square metre and less for higher EPC bands than it was in November 2025. Flat Premium fell a further -1.7%, extending a multi-year drift lower.
newbuild_geo added +1.9% over the quarter — one of the few small factors clearly working in the same direction as the Baseline.
The chart below tracks the cumulative return on five secondary factors from March 2019, each rebased to 0% at the window's start. Baseline Market is excluded here because its magnitude dwarfs the others; the story it tells is dominated by the 2020-22 surge and the recent recovery.
Two features stand out. First, the Floor Area factor has trended lower across the entire window; the market has been steadily paying less for each additional square metre relative to 2019. Second, Energy Rating is highly volatile month-to-month but has flipped decisively negative over the last quarter (-4.4%), a reversal worth watching given how much regulatory attention EPC bands attract in London leaseholds.
Flat Premium's -1.5% 12-month reading extends the multi-year weakness visible in the chart — the flat/house spread continues to grind against flats. Meanwhile newbuild_geo has quietly added +1.0% over the year and +1.9% over the quarter, one of the more consistent positive contributors.
Interactive charts for every factor, updated monthly.
Open London Factors →Methodology: rolling 3-month cross-sectional OLS of log(price/sqm) on property characteristics from HM Land Registry and MHCLG EPC data. Full details at About the model. The most recent 2–3 months are subject to revision as the rolling window updates.