Sterling to pen Man City deal extension

England forward Raheem Sterling has verbally agreed a new five-year deal with English Premier League champions Manchester City, it is understood.

The 23-year-old became British football's most expensive player in 2015 when swapping Liverpool for the Etihad Stadium in a deal rising to STG 49 million ($A88 million).

Sterling has come on leaps and bounds under the tutelage of manager Pep Guardiola, but recently talk has grown over his future, with his existing deal set to expire in 2020.

However, it is understood that a new and improved five-year contract has now been verbally agreed with the 23-year-old to keep him at City.

Sterling played a key role in City's record-breaking title triumph last term and this season has netted four goals in eight Premier League appearances.