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What drives London property prices — a factor-by-factor view

CityDataLab estimates a rolling cross-sectional regression on every London residential transaction since 1995. Instead of producing a single price index, we publish the contribution of each property characteristic — floor area, energy rating, freehold tenure, location and more — so you can see why prices moved, not just that they moved. This post is a guided tour of what the model says about London right now and where to go for more detail.

What is driving London property prices right now

The table below shows the latest 12-month return on each major London factor, computed geometrically on the cumulative coefficient curve. The Baseline Market figure is the quality-adjusted intercept — the bit of price growth that isn't explained by composition (different mix of houses vs flats, different postcode mix, etc.).

FactorCumulative (since dataset start)12-month return
Baseline Market+589.1%+9.4%
Floor Area-2.5%-3.8%
Energy Rating-9.8%-4.1%
Freehold+0.2%+0.1%
House vs Flat-2.4%-1.2%
Location Premium+1.5%+0.0%
Price Tier-1.2%+0.1%

Baseline Market returned +9.4% over the year to October 2025. The chart below shows the same figure on a rebased basis since January 2020 — useful for understanding the COVID run-up and the post-rate-rise correction together.

London Baseline Market (the quality-adjusted intercept of the monthly hedonic regression), rebased to 0% at January 2020. Latest data: Oct 2025.

Explore the London factor model

Browse recent London analysis

Data sources

The London model is built on two public datasets joined by postcode:

  • HM Land Registry Price Paid Data — every residential sale in England and Wales since 1995. We filter to county = GREATER LONDON, which gives us roughly five million transactions.
  • MHCLG EPC certificates — bulk download of every Energy Performance Certificate ever issued for a London property. We dedupe per postcode using the median floor area and the most-recent record.

Compare London with New York, Paris and Singapore

Aligned methodology, aligned axes — one chart, four markets.

Open the global comparison →

Methodology: rolling 3-month cross-sectional OLS of log(price/sqm) on hedonic property characteristics with postcode-area dummies as controls. See methodology & data sources for the regression specification.