In response to these challenges, recent changes to permitted development rights have led to an uptick in applications to convert large commercial buildings into residential units.

This renewed interest is largely driven by recent interest rate cuts and buyer preferences for developments that blend urban convenience with green spaces.

In contrast, the rental market is expected to grow at a faster pace, with a projected 5.5% rental growth in Greater London for 2024, tapering to 3.5% in 2025.

New build homes are increasingly favored by buyers due to their efficiency, the absence of a seller chain, and financial incentives, alongside a growing preference for amenities and green spaces.

Key areas identified for development include Barnsbury and Holloway in North London, Canary Wharf in East London, Southbank in South London, and White City in West London.

While house prices in London have seen a 2% annual increase as of the end of Q3 2024, they are forecasted to continue this trend into 2024.

Knight Frank's London New Homes Report 2024 reveals significant insights into the capital's new build residential market, highlighting a resurgence of interest in new homes, particularly in regeneration areas.

However, the supply of new homes in London remains critically low, with only 35,000 homes delivered annually, marking a 10% decline from the previous year and falling short of the target of 52,300.

Anna Ward from Knight Frank stresses the urgent need for innovative housing solutions to address the challenges posed by constrained supply, rising costs, labor shortages, and planning delays.