Annual rental growth in prime London reached 11.1% in the first quarter of this year, following a 3.4% increase in the first three months of 2022.
Whilst the world looks on at the saddening situation in Ukraine and the cost of living increases only time will tell how the geopolitical uncertainty might affect the rental market long-term, for now, however, it seems that it’s business as usual, and the big shortage of quality rental opportunities continues.
Annual rental growth in prime London reached 11.1% in the first quarter of this year, following a 3.4% increase in the first three months of 2022. For the first time in over a decade the prime London rental market has seen double-digit annual rental growth. As a result, rental prices are now above pre-pandemic levels across the board.
The lack of supply remains a key factor with 64% of agents reporting stock levels have fallen further over the past three months. The return of office workers, international students and corporate relocation has seen demand for rental properties increase, this coupled with some landlords selling-up in the face of an improving sales market has exacerbated the lack of stock, pushing up competition and prices across the board. As a result, some deals have resulted in bidding wars and in many cases, rental properties are being let even before they are advertised. We are, of course, always happy to accommodate overseas applicants who are unable to view in person with either video or virtual tours, please don’t hesitate to ask for these on any of our listings.
As prices rose, voids came down. During the past three months the average void levels across the capital hit their lowest levels since August 2021. All of these factors combined mean prospective tenants must be flexible in their search and be more broadminded in their locations in order to secure a property. Landlords certainly still have the upper hand, and we are unlikely to see the balance swing in favour of tenants in the short term.
The upward trend in rents is positive for the elusive, new to the market, Buy to Let Landlords. Many of whom have looked to invest their money in alternative commodities over the past three years. With rents increasing the ROI should become a much more attractive proposition and hopefully start to entice new landlords to the property market.
At Plaza Estates we make the seemingly difficult, simple. We can guide you through the Buy to Let process or explain the legislative procedures required to let your home. With over 50 years of experience in the industry we are experts in our field and are happy to help in any way we can, so please don’t hesitate to contact us.