By Siham Ben Amor, MD of WER Investments Ltd
In a market as dynamic as Central London, the question on every investor’s mind remains: “Is buy-to-let still worth it?” With rising interest rates, evolving tenant preferences, and regulatory shifts, many landlords are reevaluating their portfolios, but is the Central London property market truly losing its shine, or simply evolving?
Buy-to-Let in 2025: A Shifting Landscape
Over the past 12–18 months, we’ve seen significant shifts. According to recent data from Zoopla and Savills:
- Rental demand in Central London surged by over 11% year-on-year (2024–2025), driven by returning international professionals, students, and high-income tenants.
- Average rental yields in prime postcodes now hover around 4.2%, with areas like Marylebone, Fitzrovia, and Kensington seeing some of the fastest rental growth.
- Rents have increased by 9.7% in Zone 1 alone, outpacing the national average.
While capital appreciation may have slowed due to macroeconomic pressures, rental income is becoming increasingly attractive, particularly for landlords targeting long-term growth and lifestyle investors seeking stable cash flow.
This steady performance continues to attract overseas buyers to London property, many of whom view it as a safe property investment in the UK, combining security, global prestige, and the potential for both income and appreciation. For those seeking London property investment for international investors, Central London remains the benchmark for quality and resilience.
The Pros of Buy-to-Let in Central London
✅ High-Quality Tenants Central London continues to attract diplomats, high-net-worth individuals, international students, and corporate tenants who are often willing to pay a premium for location, convenience, and lifestyle.
✅ Strong Rental Growth Rental supply remains constrained due to planning restrictions and fewer new developments, especially in heritage zones. This scarcity drives consistent upward pressure on rents, benefitting landlords.
✅ Capital Preservation While not immune to fluctuations, prime Central London remains one of the most resilient property markets globally. Over a 10-year view, capital values tend to recover strongly, especially post-correction.
✅ Global Demand & Currency Leverage With the GBP remaining relatively weak, overseas buyers enjoy greater purchasing power, reinforcing London’s reputation as a safe property investment destination in the UK and a long-term wealth preservation hub.
The Challenges Landlords Must Navigate
⚠️ Interest Rates & Mortgage Affordability The Bank of England base rate remains high (5.25% as of mid-2025), increasing borrowing costs. Many landlords have had to remortgage at less favourable rates, eating into net yields.
⚠️ Tax & Regulatory Pressure Changes to mortgage interest relief, the additional 3% stamp duty for second homes, and tighter EPC regulations are all squeezing profits. Upcoming legislation around energy efficiency may require landlords to invest heavily in retrofitting.
⚠️ Tenant Expectations Are Higher Today’s renters in Central London expect more, from smart home integration to sustainable design. Landlords who fail to modernise may struggle to retain tenants or command top-tier rents.
Key Buy-to-Let Strategies That Still Work
To remain profitable, landlords must shift from passive to proactive investing. Some proven strategies include:
- Focusing on high-demand micro-locations like Bloomsbury, Fitzrovia, or Notting Hill with strong rental resilience.
- Furnishing and styling properties for professionals and corporate lets, which can yield 10–20% more than standard ASTs.
- Working with professional property managers to streamline compliance and tenant experience.
- Exploring short-term or serviced accommodation models (where permitted), particularly during peak tourist and event seasons.
So, Is Buy-to-Let Still Worth It?
The answer isn’t a simple yes or no. For those who adapt, Central London still offers one of the most prestigious and potentially rewarding property markets in the world. It’s not about abandoning buy-to-let, it’s about evolving with it.
Let’s Open the Conversation
Are you currently investing or considering entering the Central London buy-to-let market? What strategies or challenges are you seeing in 2025? 👇 Share your thoughts in the comments. I’d love to hear from fellow investors, landlords, and market watchers.
