Both of these areas continue to witness demand from those unable or unwilling to buy. These applicants are attracted to the easy access to the City and, increasingly, the emerging tech centres north and east of the square mile.

Against the backdrop of a subdued pre-election sales market, rents in prime central London, have continued to rise modestly, bringing annual rental growth to 2.7%. Within this market, houses have seen stronger annual growth than flats, with rents rising 4.4% and 1.7% respectively. This reflects higher volume of smaller new build stock coming on to the market from foreign investor landlords.

The more domestic market in South West London, which stretches from Battersea to Richmond and Wimbledon to Fulham is continuing to attract a wide tenant profile including families, corporate relocators and sharers. A wider range of affluent families, who have become more flexible in choosing an area in which to rent, have been increasingly attracted to these areas, given that the average rent per sq ft is less than half of that in central London.

Moving within London

This reflects the fact that searching for value has become key for a growing pool of tenants in the prime London rental market. Our data shows that a large number of tenants are moving between boroughs, with a high proportion of those renting in South West London moving from more expensive neighbouring locations.

For example, over the past two years, 56% of new lettings agreed in Hammersmith & Fulham were to tenants moving from outside of the borough, with the highest percentage coming from Kensington & Chelsea. Furthermore, 56% of new tenancies agreed in Wandsworth were to those moving from Hammersmith & Fulham, reflecting a flow of tenant demand along the wealth corridors, that has begun to replicate the sales market.

Outlook

Looking forward, the strengthening London economy and the continued expansion of sectors such as technology and telecommunications will underpin demand for prime rental property over the medium term though demand from the financial and business services sector is forecast to be more subdued.

On the supply side, a more muted sales market in the run up to the election will mean that those looking to buy remain in rental accommodation for a little longer, though this is likely to be offset by more stock being bought to the rental market by accidental landlords.

In the short term this is likely to continue to suppress rental growth. In certain locations on the fringes of prime London, where high levels of new build stock have been bought by overseas investors, we expect the extent of new supply to cause longer term downward pressure on rents.

Nonetheless, across the prime London markets as a whole we expect rents to rise by 17% over the course of the next five years, unless a mansion tax were to be levied by a new government post-election.

Read our Market in Minutes: Prime Rental Markets in the commuter belt - Q1 2015