At last we are starting to feel that it is more like ‘business as usual’, with tenant demand increasing and once again shortages of good properties in many London areas – a situation that we haven’t seen since the start of 2020!
Apartments in most residential developments are now letting very quickly, some in just a few days, as London continues to reopen and many large organisations ask their staff to return to the office, even if for only some of the time in the working week.
There is clearly a lot of pent-up demand for rental accommodation after a year ‘on hold’ when many professionals returned to their home towns, either because they were furloughed, made redundant or working from home. Many of these professionals are now keen to return to their lives in London while those who stayed in the Capital throughout, now want a change of scene are looking to move.
In fact, during the last two weeks of May, we saw a 20.3% increase in lettings enquiries and our June figures look set to increase further still. With demand increasing rapidly, tenants know they can no longer negotiate hard to lower the rental.
More properties needed to satisfy rental demand
Professionals from around the UK, or Londoners already living in the Capital, are driving most of this rental demand and it is good to be back to our pre-pandemic situation of looking for more stock to meet demand.
Some areas are starting to see enquiry levels build from overseas professionals keen to return to London and, while it is still early days, we expect this to grow over the next few months too as travel restrictions ease. Properties in parts of the city’s financial quarter remain sluggish to let but a more positive picture is emerging and the right properties if correctly priced, are getting let quicker than those where there is no movement on the rental price.
If you have recently completed the purchase of a new rental property in London and your current agent has been unable to find you a tenant or perhaps you are still considering who to instruct, please contact your nearest Benham and Reeves branch. We will almost certainly have potential tenants already fully referenced and ready to move and we can provide you with an up to date market appraisal very quickly to get the ball rolling.
Apartments letting quickly
One recent example of this buoyant market is a two bedroom apartment at Fulham Reach in Hammersmith, West London which we recently let only four days after receiving the instruction from the landlord. Our sister company InStyle Direct furnished the apartment prior to letting, creating a stylish, contemporary interior that appealed to two professional sharers, founders of a medical company, who instantly loved the flat. They moved in to the furnished apartment two days later.
This part of West London is incredibly popular at the moment and currently, at nearby Sovereign Court, we have run out of stock of properties entirely. So we are desperately looking for more stock. There are large numbers of applicants, and most properties are letting within a few days, particularly two and three bedroom flats. Many applicants are looking to move quickly, often within less than a month, as they keen to return to their workplaces. Hammersmith is also seeing interest from international applicants keen to return to London, as well as Hong Kong BNO passport holders and international students returning to their universities in the autumn.
Further West, stock levels are a little easier due to the recent launch of The Green Quarter in Southall which has seen demand increase. We are currently receiving new instructions here for the next phases, Sibley House and Watson House, which complete soon. Rental demand is high here and at Filmworks, a distinctive Art Deco style development in Ealing. Kew Bridge is also busy, but with no new apartments completing soon, our branch situated on-site here is looking for more stock, as demand is outstripping supply.
In North London, our Highgate branch is seeing strong demand for apartments at Clarendon, a large property development with recently completed apartments here letting almost immediately. We really need more stock here to fulfil demand.
New residential developments completing across London this summer
There are several brand new developments completing now and we already have new instructions in these.
In the City and East London, we have five branches with lettings departments which are handling new instructions at the latest phase of London Dock – Cashmere Wharf – which starts completing in September and for which we are already receiving instructions from landlords.
Also new to market, is Postmark London in Farringdon, WC1. This is a high end development and demand is strong – we have already let our first apartments here. One Park Drive in Canary Wharf is a stunning residential tower also attracting a lot of enquiries while Landmark Pinnacle in E14 is also seeing strong demand and The Madison, also in E14, is a 53 storey residential tower with its own private club, as well as a swimming pool, gym and spa – this too is generating a lot of interest.
These launches are clearly helping to bring more stock to East London and ease shortages which is welcome news!
In South London, our Nine Elms branch is busy, with enquiry levels getting closer to pre-pandemic levels. Apartments are letting quickly and we are waiting for new stock to complete at Keybridge in Vauxhall and Embassy Gardens (completing from the end of September) to ease the shortages. You can listen to Sarah Edwards, our Nine Elms Manager give a local market update about Keybridge here.
Currently 100% of our existing tenants at Nine Elms are renewing their tenancy agreements which highlights the impact that this is having on stock availability. Most apartments are letting within 24 hours and we already have waiting lists of referenced tenants.
International students returning
It is still early to gauge demand from international students, but the good news is that some branches are already reporting enquiries from overseas students looking to return to their London universities in September, either to resume their studies or to start a new course. This is clearly a positive indicator for the academic year ahead.
Renewal rates by tenants generally are high. Many tenants who remained in London during the pandemic secured good rental deals with their landlords and many of these yearly leases are now up for renewal. As they continue to enjoy good value for money, many existing tenants are renewing. While this is good news for those tenants, it does add to the current shortages of stock, with fewer rental properties coming back onto the market.
A final word about interior presentation
Despite the rental market hotting up, presentation remains key to a quicker let. Landlords can find it hard to keep an eye on the condition of their rental property between tenancies – not always aware if it needs new furnishings or perhaps a lick of paint to spruce it up. An inventory may tell you about specific items that need replacing but it won’t tell you how the property presents overall – whether it has the right tenant appeal. Overseas property owners who haven’t been able to travel to the UK for well over a year may feel particularly out of touch and landlords may not realise their property is overdue a refresh until it has been sitting on the market for several weeks – and of course that costs money in lost rent. With presentation being key, now is a good time to review the presentation of your rental property and talk to us if you would like more information about our furnishing packs. Or we can arrange visit the property between tenancies and provide a report on any work that needs doing and provide a complete breakdown of the costs involved.
Your rental property is one of your most valuable assets. You organise an MOT for your car each year and you need to do the same for your rental property to keep it in tip top condition so it pays to invest in presentation.
Contact us for a free rental appraisal of your property
View all posts by Anita Mehra