The London rental market went from strength to strength throughout 2014 and this is already continuing into the New Year. Demand for rental properties in London is very strong and, after the usual quieter period in December, the New Year has started with a real flourish of activity across our eleven London branches. Young professionals continue to make up much of this rental demand with many choosing apartments in the city’s smart new developments. New apartments coming onto the market usually let very quickly but we are still experiencing low stock in some locations with applicants on waiting lists in places like Beaufort Park, North West London and at Dickens Yard in Ealing.
Our Hyde Park office has been experiencing a mini boom in rental demand in the New Year, with enquiries flooding in, particularly for one and two bed apartments. There is strong interest from relocation agents, usually working on behalf of young, single professionals. Rental properties in W2, especially those in new developments, are being let particularly quickly.
Rental apartments in Paddington Basin continue to be in particularly high demand, with 3 Merchant Square at the top of many applicants’ wish lists. This new wave of apartments launched recently and are being snapped up. Rentals vary from £550-£600 per week for a one bed apartment to £750-£800 per week for a smaller two bed and £950-£1050 for a larger two bed, with landlords achieving asking rentals. Strong competition means we are achieving above asking rental yields in some cases. Around 90% of apartments to let at 3 Merchant Square are being rented by executives from the Far East. The style and high specification of these brand-new apartments is the type of accommodation they are used to living in and this preference continues when searching for a home in London.
Currently, we’re seeing a trend for applicants seeking a tenancy which will allow pets, perhaps due to the proximity to Hyde Park. Some landlords can be initially reluctant to accept a pet, but increasingly we’re finding that with a slightly higher security deposit and additional relevant clauses to the tenancy agreement, many are now happy to do so and we haven’t experienced any issues.
Demand for rental properties in West London is equally buoyant. Our Ealing office is reporting strong demand for homes in new developments such as Dickens Yard, Kew Bridge West and 8 Kew Bridge Road. Skyline, the latest phase of Dickens Yard, launched at the end of 2014 and we saw exceptional demand for apartments, with some tenants bidding above the asking rental to secure their chosen property. Applicants are paying up to £400 per week for a one bed and up to £575 per week for a two bed apartment. We’ve also been inundated with enquiries for Kew Bridge West, and with 8 Kew Bridge Road launching soon, we anticipate equally high demand.
Our City, Canary Wharf and Greenwich offices had a record-breaking year in 2014, with business up 25% on 2013. This high demand is continuing into 2015, and we currently have a register of 12 to 20 applicants for every available one bed property in the City. With consistently strong demand, landlords are achieving good yields, with void periods of under a week. Rents are increasing generally in line with RPI (Retail Price Index).
One emerging trend we are seeing is a gradual shift in tenant profile, with the majority of applicants now working for management consultancies, accountancy, finance and IT firms, rather than the banking sector from which much of the City rental demand has historically come from.
Another growing trend is tenants’ increasing flexibility over location. Just a few years ago, many applicants would confine their search perhaps to Canary Wharf and the City but increasingly, we are finding that most are happy to broaden thir horizons to a wider area as there are so many excellent new developments across the wider East London area. Most are happy to move further out if a development offers a high specification and excellent amenities such as a gym, swimming pool and increasingly, a concierge service. This explains the success of developments like Kidbrooke Village, where uptake has been really strong and demand has exceeded our initial expectations, despite its Zone 3 location. The spec and facilities are excellent, the rents affordable, and with only a 20 minute commute to Cannon Street, tenants are happy to travel slightly further to save money.
Rental demand at Beaufort Park remains very strong and we’ve started the New Year extremely well, with high numbers of enquiries, particularly for studios, one beds and Manhattan apartments. One bed apartments are achieving £270-£300 per week and two beds £350-£420 per week.
Most applicants are professionals, working in the City and central London. Often they are looking to move out of central London to find better value for money. Being close to the Hertfordshire countryside is another bonus. At developments such as Beaufort Park, they can find high specification rental accommodation and good facilities at a more affordable rent, yet only a short commute from the City, so the development and the area tick a lot of boxes.
Budgets are good and applicants are happy to pay a premium for the newer developments, such as The Empire, Claremont, Cavendish and Ellison, which are in the highest demand.We have a waiting list for one bedroom apartments at the moment, with properties usually achieving asking rentals. With demand so high, void periods are minimal and properties tend to let within a week and a half at most – we are short of stock so are actively looking for new instructions
If you are looking to rent a property in London, please contact our friendly lettings negotiators who have excellent local knowledge and will help you find your ideal home.
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