Rental Market Update – July 2014

Central London

Rental properties in Kensington are letting quickly, particularly one and two bedroom apartments. With an easy commute high on many tenants’ wish lists, homes within a quarter mile radius of High Street Kensington tube station are in particularly high demand.

The relocation market is picking up and we’re receiving numerous enquiries for two, three and four bed properties.  Enquiries are dominated by finance industry executives, particularly from the US.  We’re also busy with requests from families who already live locally but are looking to upsize to a bigger Kensington property – this is increasing demand for larger homes, especially those located within the catchment areas of the best schools.

Accommodation budgets are good at the moment and applicants are generally happy to pay close to the asking rental as long as the property ticks most of their boxes and they feel they are getting value for money.

Demand for rental apartments in Ealing,  West London, is also high.  Properties at the Dickens Yard development are letting almost immediately, most for close to the asking rental.  We’ve concluded over 60 lettings here since it launched.  We are starting to see shortages of properties and we’re keen to find new stock.   Around 90% of tenants are renewing their tenancy agreements and we’re finding that tenants, once they have settled in, are keen to stay.  With such high demand, landlords are experiencing virtually no void periods.

City, Canary Wharf, Docklands and Greenwich

Our City, Canary Wharf and Greenwich offices are experiencing strong demand and we are receiving high numbers of enquiries from tenants.

Generally, we have a good supply of properties but the tables are turned at the moment in terms of the type of property for which demand is strongest. Unusually, one bed apartments are a little slower to let than usual while two bed apartments are flying out.  Over 90% of two bed apartments in the City and Canary Wharf  are letting to professional sharers, indicating a continuing desire by tenants to reduce their accommodation costs.

Rents are static though and the market is more price sensitive than a year ago so accurate pricing is essential. If a tenant is paying upwards of £375 per week they expect a property to be beautifully presented and in perfect condition.  Standards have really risen over the last couple of years and a showhome standard property is the norm now in this price bracket. This means landlords may need to consider carrying out some refurbishment work or adding some new furnishings to ensure they attract a good tenant. With good stock levels currently, competition to attract tenants is fierce and if a property doesn’t let within a couple of weeks, we suggest landlords consider taking pro-active steps such as reducing the rent to minimise void periods.

Young professionals continue to flock to find rental properties in Greenwich and Blackheath. Apartments in landmark developments such as New Capital Quay, The River Gardens and City Peninsula are letting immediately and we frequently have waiting lists.

North/North West London

Rental demand is good at the Beaufort Park development in Hendon and we’re seeing increasing numbers of new applicants registering with us.  There’s a real buzz here and properties are letting quickly.  Many new applicants are referrals whose friends or colleagues have recommended moving to Beaufort Park and it’s interesting to see how the development’s reputation is spreading.

Ellyson House and Emerald House are the latest buildings to launch and apartments here are fetching strong rents – asking rents for Manhattan apartments are £270-£280 per week and two bed apartments from £360-£420 per week. Some investors are still completing in this latest phase so we’re still receiving new instructions. However, there are higher numbers of owner occupiers moving into these new buildings than previously so the supply of rental apartments is more limited.  Generally, tenants are happy to pay a premium of £10-£20 per week extra for these brand new apartments. Overall, rents at Beaufort Park are £5-£10 per week higher than this time last year.

Over in Hampstead, rental demand is also strong, the summer months being our busiest time of year. We’re especially busy with enquiries from relocation agents looking on behalf of families, mainly from the US and Europe, keen to move before the start of the September school term.  Executives looking for family homes in Hampstead have slightly higher budgets than recently which is pushing up rents a little. We have plenty of high calibre properties available and competition is fierce for these but we are starting to run short of three bedroom properties so are actively looking for new instructions.