London property rentals have had a strong year and as it comes to a close, we predict a great start to the year ahead. 2014 proved to be an excellent year for prime Central London and we have worked hard to ensure that relationships with landlords and tenants are as strong as ever.
During the last month, while we expect seasonal fluctuations in applicant numbers, we are seeing an increase in enquiries from tenants wishing to secure their dream home ahead of January.
We have also seen an increase in tenants renewing their tenancy agreements, which has helped landlords keep void periods to a minimum. Once they’ve found the right property in their preferred area, tenants are choosing to stay, preferring security over the cost of moving home. This is obviously good news for landlords, as continuation of tenancy give the tenant security and the landlord a steady income.
Over the past year, we have advised landlords to take a more realistic approach to yields, particularly if they have a property in a prime location like Kensington and Knightsbridge as tenants become more price-sensitive. When we work closely with landlords, we can maximise the rental potential of each property, attracting reliable tenants and working hard to negotiate long leases. Our corporate lets service which operates out of Central London has seen a 12.2% increase in lets this year and many of our corporate tenants tell us how much they value having their property professionally managed by us. With the General Election looming in 2015, we are aware of the impact this will have in terms of the economy and the London rental market, especially in Central London. Property investors, employers and the financial market are taking a ‘wait and see’ approach and we will manage the resulting impact on the lettings market using our 50+ years’ experience and expert knowledge of the market.
Our best advice for the year ahead would be to ensure your property is well-presented and let us work on your behalf, using our local area insight to your best advantage. If you are a seasoned investor, you will be used to the peaks and troughs of the market and even if rents stagnate for a little while you should be cushioned by continued capital growth.
Our City office has seen great demand over the year, spread across the whole of the East London area. International students and corporate tenants are choosing to live in the new developments which are being built such as New Capital Quay and Kidbrooke Village in South East London. Any development which is situated close to transport, with direct links to the city is at the top of a tenant’s wish list and we have found that tenants are willing to move out of their preferred area to find their perfect property.
Due to the economic climate, we have seen companies renew short-term employee contracts, rather than relocate staff from overseas. This change has been offset by the increase in the number of international students choosing to live in these high-specification developments.
As over 90% of our rental properties have been furnished using a specialist furnishing package company, the quality and standard continues to increase and applicants really do expect this level of attention to detail.
Similarly, 95% of our properties are managed for landlords, allowing busy professional tenants to make a single phone call to address any issues, a level of service which our landlords find invaluable, especially if they are based overseas where we also have international offices so clients can talk to someone in their own time zone.
Demand has been high for two bed apartments priced at the £500 per week mark, with the international student market also seeking three double bedroom properties which offer increased living space for sharers.
July to October of this year was our peak period, with up to eight applicants chasing the same property. We ensure that we are consciously managing our stock levels and are able to use the quieter month of December to market to tenants looking to move in January.
Looking forward to 2015, we predict that if the economy continues to pick up, the city will take a more optimistic view, leading to companies hiring and attracting inbound talent once again. These corporate tenants will be looking for five star hotel-type properties, such as new developments like The Heron, which offers a 24 hour concierge service, premium leisure facilities and the highest specification interiors. With the growing number of new developments being built in the city, there is a genuine demand to both live and work within the area.
Westfield Stratford and the Olympic Park have also increased demand a little further afield, with tenants looking for properties in Poplar, Bow and Stratford. As these areas have direct links to the heart of the city, tenants are happy to move further afield.
In 2015, we predict there will be greater demand for properties on the fringes of central London, with developments such as Marine Wharf, Surrey Quays and The Library Building, Clapham proving extremely popular with tenants. These properties offer tenants a very high standard of living and we expect these to be star players in the year ahead.
Our Hampstead office has had a great year with demand for accurately priced houses letting well throughout and an insatiable demand for one bedroom flats that we never seem to be able to keep up with as there is not enough stock.
Applicant levels have been consistent throughout the year, predominately from corporate and professional tenants showing just how popular this location still is.
We have seen a high demand for two bedroom properties in the area as we have noticed a shortage of premium two bedroom properties in recent months.
Tenants who have relocated from overseas are increasingly extending their tenancies, as companies look to avoid the costly exercise of relocating personnel and their families. This is especially true of the £1000 per week properties.
The rental demand across North West London continues to grow and we are confident of repeating our success in the year to come. We have doubled our staff at the branch this year and many new instructions are coming from a new generation of buy-to-let landlords who are keen to park their money in a historically popular area of London where growth has continued year after year.
Our West London offices have had an excellent 2014, with an especially buoyant November. There continues to be a great deal of interest in developments such as Dickens Yard, Kew Bridge and newcomer Kew Bridge West. These new developments are attracting a wide range of tenants, helping to boost the West London property market. Applicants working along the M4 corridor are looking to get into their new homes before Christmas and as such, demand is very high for these properties.
Tenants are ranging from international wealthy students to young professionals and couples, giving the area a diverse mix of inhabitants. Our highest demand properties are currently one bedroom apartments, closely followed by two bedroom properties which have two bathrooms.
Due to the demand for these high-specification properties, we have an ongoing waiting list, which is helping to eliminate void periods for our landlords. As the second phases of these prestigious developments come onto the market, we can expect to have a busy start to the new year ahead.
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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