London residential property a favourite asset for many of Asia’s UHNW clients is back on the rails after a period of wait and see due to the recent UK general election.

Global agency Knight Frank have issued a report showing that rental values in prime central London continued to climb in May, and annual growth of 4.2% was the highest figure since December 2011.

It compares to a decline of -1.4% in May 2014 and the positive upwards momentum over the last year has been driven by the recovering UK economy and the transfer of demand from the sales market ahead of last month’s general election.

Last month, the Confederation of British Industry said economic growth had “cranked up several gears” with the business and professional services sector having seen the fastest growth in business volumes in more than nine years.

Furthermore, the government said in May that employment was at its highest comparable rate since records began in 1971.

Financial markets also received a boost in May, with more than £50 billion added to the value of companies listed on the London Stock Exchange the day following the general election.

While the prime central London lettings market is operating against this increasingly positive economic backdrop, it hasn’t yet fully hit its stride in 2015.

A mood of hesitation around the election, combined with the two bank holidays, meant activity in May was slower compared to last year in what was a “stop-start” market. The number of new prospective tenants was down 12% in May compared to the same month in 2014, while the number of viewings declined 18%.

In spite of the recent dip, new prospective tenants and viewings in the 12 months to May 2015 are up by 12% and 7%, respectively, and activity is expected to increase over the summer as part of a seasonal trend among students, families and corporate tenants.

Demand has remained strong in markets including Marylebone and Hyde Park, particularly in lower price brackets, suggesting companies and private renters are still cost conscious despite the improving economy.

Prime gross rental yields edged upwards to 2.96% in May, their highest level since August 2013, widening the spread between the risk-free rate on a 10-year government bond.