The rental market in London remains relatively strong – we are seeing many new developments or phases of developments completing now and this will continue over the summer months, increasing stock levels. Beaufort Park in Colindale has transformed this previously overlooked area into one of the most popular places to live in this part of North London, drawing professionals here who only a few years ago might only have considered living in central London. The latest phase, the Castleton Apartments, is now completing and as usual, this new building is attracting a lot of enquiries from applicants.
Another exciting area of regeneration is Vauxhall – the home of Nine Elms Point, Battersea Power Station and many other developments. The final phase of Nine Elms Point is completing now and the area generally is attracting increasing numbers of young professionals. Again, previously overlooked, Vauxhall is only two or three tube stops away from central London and the quality of these new builds is exceptional. And because Vauxhall has only recently increased in popularity so dramatically, rents remain affordable in comparison to more traditional areas of central London although they are now starting to edge up.
But the rental market is not without its challenges. The Tenant Fees Act came into force at the beginning of June and leading up to this we saw a slight slowdown in demand as tenants, if they were able, delayed moving home until the ban came into force, saving themselves money on fees and sometimes a reduced deposit too. The upside is that we are now starting to see the market picking up again as this pent up demand is released and tenants start to plan their next move.
A priority for landlords in the current market is firstly to ensure their property is accurately priced when it comes back onto the market – for this the advice of your local agent is essential. If the property has been tenanted continuously for the last two or three years, recognise that the rental market has changed and the current asking rent may not be the same as it was previously – it may actually be a little lower, especially if newer buildings in the same development are now available.
Secondly, make sure you resolve any disputes with the tenant quickly at the end of the tenancy so that you can return the deposit and have the property cleaned and refurbished if necessary, ready to put it back on the market as quickly as possible. Maintaining a good rental yield means minimising voids so speed is of the essence – this is more important than saving a few pounds by disputing the cost of a few new plates or glasses.
For expert advice on the rental market in your local area, please call your nearest Benham & Reeves branch manager.
Our Dickens Yard (Ealing), Kew Bridge and Imperial Wharf/Chelsea Creek branches continue to see good rental demand from professionals and corporate tenants, although shortages of stock remain an issue, particularly one and two bed apartments. As a result, most apartments are letting as soon as they become available. Almost all current tenants are renewing their tenancies too. Relocation agents are busy looking for properties for clients and we are still seeing plenty of Japanese corporates moving to Ealing and nearby parts of West London as they are keen to be close to the Japanese School, Japanese supermarkets and other amenities. At Fulham Reach in Hammersmith, enquiry levels are extremely high and stock levels are starting to pick up too. Stock levels will further improve when The Henley Apartments start to complete in the summer. Our available apartments at Sovereign Court are now 100% occupied and generally we are seeing very few apartments becoming available as tenancy renewals remain at a very high level.
Rental demand is good across the City and East London although stock levels remain an issue and we continue to see shortages of apartments. Tenants’ budgets are definitely increasing and most are looking for a property priced at £400 – £1200 per week. We are seeing plenty of tenants move to East London to work for tech companies and business start-ups and this is a strong and growing trend. These professionals in particular seem to be spending more on accommodation. Many are signing a two year contract – at the very least a 12 month contract – whereas banking professionals usually ask for a 6 month break clause. This appears to indicate a confidence amongst those working in the tech sector. In terms of tenants’ priorities, apartments with roof terraces, gardens or ‘sky lounges’ are becoming increasingly popular as professionals look to enjoy outdoor space without having to venture too far – in this country we can experience three seasons in a single afternoon so being close to attractive outside space is essential to really make the most of sometimes brief spells of sunshine!
These roof gardens also offer a comfortable space to relax and socialise with other neighbours in the building, helping to build a sense of community and improve their quality of life. So access to this type of space is fast becoming an ‘essential’ on many tenants’ wish lists. For this reason, Pan Peninsula in Canary Wharf is very popular – all its apartments have balconies and there is also a sky lounge with stunning views on the 31st floor of the East Tower. It also has a cocktail bar and restaurant with terrace. In the City, Blackfriars Circus has its own roof top terrace, again with stunning views. One Blackfriars is also popular and this building too places a focus on communal space – with a terrace as well as an executive lounge on the 32nd floor, again with stunning river views. Goodman Fields (where we handle enquiries through our City and Wapping/London Dock branches) has its own roof terrace as do the nearby Kensington Apartments, also in Aldgate. Wapping Riverside’s roof garden enjoys panoramic views of the Thames while at Surrey Quays, Marine Wharf has beautiful communal gardens where residents can relax and socialise. And while fewer Greenwich residential developments have their own private gardens, many have balconies with river views and the area is well known for its beautiful parks and open spaces.
In North London, the ever popular Beaufort Park development in Colindale continues to see demand increase and relocation agents are particularly busy carrying out property searches on behalf of overseas professionals keen to move to the area as they relocate with major tech firms in the City and Kings Cross. In particular, one bed apartments are letting very quickly. We have good stocks to meet demand as new stocks coming to market regularly – units are now completing at the latest phase, the Castleton Apartments. Nearby Colindale Gardens is also popular. Many professionals are signing two year tenancy agreements which is clearly a good sign, and a reflection of tenant confidence and their plans to stay in the area long-term.
In Highgate and Hampstead rental demand is picking up although it remains hard to predict at the moment, with enquiry levels fluctuating. One and two bed apartments are letting quickly and tenants’ budgets are fairly good – typically one bed apartments are achieving £300 – £400 per week and two beds £350 – £550 per week.
The final phase of Nine Elms Point is starting to complete now and our on-site branch at the development has quite a number of new instructions in this popular building, with fully referenced tenants waiting to move in. One bed apartments are achieving upwards of £525 per week and two beds upwards of £675 per week. Generally, rental demand in the area is continuing to pick up and, because little stock has launched over the last three months, there is strong competition amongst tenants for new units as they become available. Most (around 75%) of current tenants are renewing their tenancies at the moment. Rents on renewals are seeing slightly increases – approximately in line with RPI. Around 70% of apartments at Nine Elms Point have been purchased by Chinese investors, many of whom have bought multiple units. As we are Barratt’s recommended letting agent for the development, we are handling all these instructions so have good stocks. For this, we are liaising with our Shanghai office where we have a number of fluent Chinese speakers, which makes letting and property management much easier for our Chinese clients.
In central London – Hyde Park, Knightsbridge and Kensington, the rental market is continuing to improve as we move towards the summer months. We have fairly good stocks and generally tenants are looking for good value, good presentation and as much space as possible – and in this competitive market, they do expect to negotiate with landlords. Older properties (even if only five or six years old) should be refreshed and redecorated to ensure they present well. Unusually, we are seeing properties priced at around £1000 per week letting most quickly at the moment. This is because we are working with a number of relocation agents who are actively searching on behalf of professionals from the US, Australia and the rest of the world (rather than Europe) working for large banks and financial organisations with good accommodation budgets. We are also finding homes for a number of tech professionals working in the airline industry. Tenancy renewal rates remain high at around 85% as most tenants are choosing to stay in their current accommodation on renewal. We are also now starting to see enquiries coming in from students in preparation for the start of the university term in September.
If you have a property to let in any of these areas, or would like a free no-obligation rental valuation of your property please contact us. For more London rental market news and updates, subscribe to our newsletter.
View all posts by Anita Mehra