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Home News Property market updates, Rental market update The London Rental Market – June 2016

The London Rental Market – June 2016

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Luxurious new residential developments are the driving force behind London’s booming rental market and applicants looking for high-end rental accommodation in London tend to prefer this type of home. This is why we are focusing our expansion on these popular locations, having recently opened new branches in Fulham Reach in West London, Marine Wharf and Wapping in East London. May saw us open our latest branch, this time at St George plc’s new Kew Bridge development in West London. With 15 branches now open for business across the capital, this month has been a real milestone for us and we are delighted to see that the summer rental market is now in full swing.

Central London

Kew Bridge development
Kew Bridge development

There is increasing activity in the Knightsbridge rental market which continues to improve as we move into the summer months, with high-quality two bedroom apartments in the £600 – £900 per week price range most sought-after. We are taking on a number of  new instructions, from luxury two bedroom apartments to smart townhouses, typically priced from £1100 – £1700 per week. We are letting most of these to corporate tenants and families looking for homes ahead of the September school term – families tend to have larger budgets and are looking for three to four bedrooms. This is also the start of the student market and typically budgets for sharers are £550 to £750 per week for a two bedroom apartment or £300 to £350 per week for a studio. Many tenants are renewing their tenancy – a good option for landlords in this competitive market as it eliminates expensive voids and reduces administrative and decorative costs between tenancies.

Our Kensington branch reports that the rental market is really picking up, with enquiries in May around double those of the previous month. Applicants are becoming quite demanding and appear to be looking for a real statement home. Most are specifying either a brand new, ultra-modern apartment like those at 375 Kensington High Street or a traditional period property – these are the homes for which rental demand is highest.  Typical budgets are from £600 to £1500 per week.

Rental demand remains very high around the Hyde Park area and a continuing trend is the demand for high-end, luxury properties, priced between £1000 and £2000 per week. We have good stock levels of properties in prestigious developments and are receiving a lot of interest from senior professionals and corporate clients, many of whom have been recommended to us by colleagues who have rented homes through us.  These applicants are extremely discerning and they will not consider a standard new-build home, specifying only ultra high-end developments with the highest spec, even being as precise as demanding a particular type of wood flooring or home automation system.

Rental demand in Ealing is very good and we are actively looking for new stock to meet this demand.  The next phase of the Dickens Yard development, Dashwood House, is completing at the moment and we already have fully-referenced tenants waiting to rent new properties here. Rentals are from £370 per week for a one bedroom property and upwards of £500 per week for a two bedroom apartment. We are seeing good demand from corporate tenants in particular.

May saw the launch of our latest branch, our 15th, at the new St George development, Kew Bridge. Kew Bridge combines the high spec and amenities of a brand new property with the affordability of a Zone 3 location, with good transport links into central London. Demand is high and the development is attracting professionals from many industries and corporate tenants from overseas are also relocating here. Typically rents range from upwards of £325 per week for a one bedroom apartment and £450-plus per week for a two bedroom properties.

Over at Fulham Reach, rental demand is also good and May was a very busy month.  Properties have been letting well and the most sought-after are one bedroom apartments at £500 per week and two beds at £750 per week. At Imperial Wharf and adjacent Chelsea Creek, the rental market is very busy, with high demand from applicants looking for one and two bedroom apartments. These two developments almost create their own rental market, as many tenants will only consider living in this exclusive part of West London.

City, Canary Wharf, Docklands and East London

2 bedroom apartment at New Capital Quay, SE10
2 bedroom apartment at New Capital Quay, SE10

Rental demand in the City and Canary Wharf is as strong as ever, with most enquiries for one bedroom apartments. Tenancy renewals remain high at around 70% as tenants look to save themselves the cost of moving. This is good news for landlords who usually find retaining a good tenant is advantageous in the long term by eliminating voids and cutting the cost of administration and remedial work between tenancies.  Many tenants are moving to Canary Wharf where there is a greater supply of homes, so asking rentals are lower. A typical one bedroom apartment in the City is achieving £450 to £650 per week whereas in Canary Wharf a similar property is renting for £325 to £425 per week.

Rental demand is also high in Marine Wharf at Surrey Quays and Wapping, where again one bedroom properties are most popular, typically renting for £325 to £395 per week.  These are popular locations for professionals working in IT and the creative sector around Shoreditch. Both these branches are seeing plenty of applicants, again looking for smaller properties.

One bedroom apartments are going like hot cakes in Greenwich too, typically for £325 to £375 per week.  There is a good availability of rental homes which offer a high spec and an easy commute (20 to 30 minutes) to the City.  Affordability remains a key attraction, as well of course, as the appeal of the beautiful local area.

With most tenants prioritising value, we are seeing a noticeable rise in popularity of studios and Manhattan apartments (which have a separate sleeping area) across the locations covered by our five East London branches.  Around 95% of these studios are situated in new developments so offer a high spec and good value for professionals keen to spend no more than necessary on rental accommodation.

North West London

There is good demand for studios and one bedroom apartments at Beaufort Park in Colindale and we are letting properties as soon as they come onto the market. We have limited stock at the new Carleton apartments which launched recently and have been very popular – rents range between £240 per week for a studio and £320-£330 per week for a one bedroom apartment. Demand is so strong that we have fully referenced tenants on waiting lists before new properties even complete. Next to launch are the Goldhawk apartments and we have been receiving enquiries from tenants about these for some weeks. A particularly positive trend is the increasing number of enquiries we are receiving from applicants who wish to move to Beaufort Park on the recommendation of friends who already live here.  There is also a noticeable trend towards longer, two or three year tenancies, with tenants keen to stay long-term rather than have the hassle and expense of moving.

Business is brisk in Hampstead with one and two bedroom properties just flying out. Properties with a garden or terrace are in particularly high demand as are homes close to Hampstead Heath. Relocation agents are very active now, looking for larger homes for families looking to relocate to the area ahead of the September school terms. As ever, Hampstead’s excellent schools are a real draw for those relocating here from overseas.

Stanhope 2
6 bedroom house, Stanhope Road, N6

Our Highgate branch has also had a very good month, attracting plenty of new instructions. One bedroom apartments to substantial four, five and six bedroom family homes are in demand, including this impressive Edwardian House on Stanhope Gardens that just happened to be the home to Eighties rock band Pink Floyd. There is strong demand from applicants looking for rental homes in Highgate, as ever, particularly for one and two bedroom apartments and we are also now seeing growing interest in larger properties, as families relocate to Highgate in plenty of time to settle in before the September school term

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About the Author

For 40 years Anita has been the driving force behind Benham and Reeves’ success as it has grown from a single branch in Hampstead, to one of central London’s oldest, independently owned sales, letting and property management companies. Anita's vision has driven the expansion of the business to offer a complete range of property investment related services from under one roof, from purchase to handover, furnishings and/or refurbishment to lettings and property management. Read more about Anita Mehra here - Read full profile