{"id":20588,"date":"2022-03-03T16:11:31","date_gmt":"2022-03-03T16:11:31","guid":{"rendered":"https:\/\/www.benhams.com\/news\/?p=20588"},"modified":"2024-07-22T08:58:42","modified_gmt":"2024-07-22T07:58:42","slug":"mar-2022","status":"publish","type":"post","link":"https:\/\/www.benhams.com\/news\/property-rental-market\/mar-2022\/","title":{"rendered":"Exceptionally high demand for London rental accommodation"},"content":{"rendered":"

\"highLondon\u2019s rental market remains strong, with multiple applicants often \u2018competing\u2019 for the same property and apartments letting immediately in most cases, as long as they are accurately priced in line with current market conditions.\u00a0 For months now we\u2019ve had lists of fully referenced applicants prepared to wait two or even three months until a rental property becomes vacant.\u00a0 And as international travel continues to open up and we see greater numbers of professionals moving back to the UK for the first time in a couple of years, the resulting shortage of rental properties in London<\/a> continues.<\/p>\n

As always, we need more stock to meet this unprecedented demand, so if you have a rental property, either a new apartment or one that is becoming vacant soon, please get in touch with your nearest Benham & Reeves branch<\/a>.<\/p>\n

Professionals returning to the office<\/h2>\n

\"ProfessionalsWe are starting to see subtle changes in the market as we return to normal, particularly as working patterns are shifting towards a mix of working from home and a return to the office.\u00a0A noticeable trend is this move by larger companies to encourage their staff to return to the office \u2013 at least part of the time.\u00a0 This means that applicants may once again be looking to rent a home closer to their place of work, perhaps after living further out of London for the last couple of years.<\/p>\n

Our 19 London lettings branches<\/a> are also now seeing increasing numbers of enquiries from overseas professionals who are returning to London or maybe changing jobs.\u00a0 They are from a mix of countries including Europe and the US and most have good budgets.<\/p>\n

A gradual shift in tenants\u2019 priorities<\/h2>\n

So this return to the office is influencing the type of property that many applicants would like to rent.\u00a0 There is a gradual shift in tenants\u2019 priorities as many are now looking to find a home within an easy commute of their office in central London, the City or Canary Wharf<\/a>.\u00a0 Properties close to a Tube or overground station are back in demand but additional space (often a second bedroom) to be used as office space when working from home is also important.<\/p>\n

And the cost of renting a larger property, combined with the cost of the commute, inevitably means bigger bills and affordability is becoming a concern for many applicants.<\/p>\n

Affordability<\/h2>\n

\"professionalsRents dropped across London throughout the pandemic, but they have been climbing for several months now, mainly due to the chronic shortage of rental properties<\/a> coupled with increasing demand from domestic and overseas professionals and students returning to London.\u00a0Rents are generally back to pre-pandemic levels and in some cases 5% -6% higher and with rising interest rates, this increase will no doubt be welcomed by our landlords<\/a>.<\/p>\n

Tenants renewing their current leases are paying the new market rentals (many will have probably been paying below market rate previously).\u00a0 But landlords should be aware that there is a limit to what tenants can afford to spend on rent.\u00a0 Inflation in the UK is at a thirty year high, increasing the cost of renting substantially so there is an affordability factor to consider and a limit to what tenants might be able to pay. This is when thorough tenant referencing becomes essential and landlords should be careful to check their agent has a robust system in place like we do.<\/p>\n

Assessing the cost of living and renting in London<\/h2>\n

We recently carried out research examining the cost of renting in relation to household income in different areas of the UK and it reveals some interesting findings.\u00a0 You may be surprised to learn that London, while undoubtedly expensive, is not the most expensive place to live in the UK in terms of the overall cost of renting as a percentage of monthly income.<\/p>\n

Find out more here in on our research article <\/a><\/p>\n

Demand for rental properties across London –\u00a0The City and East London<\/h2>\n

\"DemandRental demand remains strong throughout the areas covered by our City and East London lettings branches<\/a> and a lack of housing stock is a key challenge for us.\u00a0 We\u2019re seeing a lot of enquiries from tech professionals and from relocation agents searching for properties on behalf of overseas clients, including Europe and the US and, increasingly, India.\u00a0 Accurately priced rental properties are letting within five to seven days.\u00a0 Budgets are good, and applicants are typically looking for properties<\/a> in the \u00a31500 – \u00a34000 per month price bracket.<\/p>\n

Tenancy renewal rates remain high, with around 60% – 65% of current tenants renewing, usually at the current market rent, whereas previously they had often been paying below market rent.\u00a0 Generally, tenants are only moving on if they are relocating to a new area or because of a change in circumstances.<\/p>\n

We have a couple of exciting new phases of developments completing soon \u2013 Merino Wharf (from the Berkeley Group) at London Dock<\/a>, which starts completing at the end of March, and One Bishopsgate Plaza, a landmark tower in the heart of the City.\u00a0 \u00a0We are already receiving enquiries for both buildings and have new instructions lined up in both.<\/p>\n

West London (Dickens Yard, Fulham Reach, Kew Bridge and Imperial Wharf)<\/h2>\n

In West London, we\u2019re seeing a significant trend towards professionals returning to the office and therefore searching for homes closer to Tube or overground stations.\u00a0 Many still require space to work from home too, and this is presenting a challenge \u2013 more space and good transport links \u2013 within their budget.\u00a0 We have little stock available now and most applicants are signing tenancies for properties that will not be available until later in March or April.<\/p>\n

At The Green Quarter in Southall<\/a>, landlords are completing on a new property one day and having it furnished the next – by the following day we will already found a professional tenant for them.<\/p>\n

Landlords are achieving good rents, sometimes over asking rental if there are multiple enquiries.\u00a0 Tenancy renewal rates are high as most existing tenants are not moving unless they have a good reason.\u00a0 We\u2019re seeing a lot of enquiries from relocation agents, mainly for clients from Europe and the Middle East and Asia.<\/p>\n

We always need more stock and are keenly waiting for the completion of new apartments at Grand Union (Berkeley Group) a new canalside development in Alperton, and Western Circus (Barratt London), a new residential quarter in Acton.<\/p>\n

Our Fulham Reach branch in Hammersmith<\/a> is seeing more movement in the market and a greater turnaround of properties.\u00a0 Some tenants are looking for a change and deciding to move, although still staying local.\u00a0 Rents are back to pre-pandemic levels and apartments are letting immediately.\u00a0 We have very little stock available so are actively looking for new instructions.\u00a0 The last month has seen a rise in enquiries from relocation agents, mainly for European clients.<\/p>\n

Central and South London (Nine Elms, White City, Hyde Park, Knightsbridge and Kensington)<\/h2>\n

\"CentralStock levels are low across Nine Elms<\/a> and Vauxhall but we will be receiving new instructions soon which we expect to be in high demand.\u00a0 Phase 3 at Battersea Power Station is due to start completing at the end of March while Thames City, a landmark development overlooking the Thames, will be completing from May.\u00a0 A new block at the DAMAC Tower is also completing from the end of March.\u00a0 Rents generally are at pre-pandemic levels, with apartments letting quickly.\u00a0 Most applicants are international students.\u00a0 Tenancy renewal rates remain high but existing tenancies are being agreed with increases of 15% – 30% and are at current market rents.<\/p>\n

In prime central London<\/a>, the rental market is seeing good demand.\u00a0 Rents are increasing and applicants are making sensible offers for properties.\u00a0 Our Knightsbridge branch<\/a> is seeing a shortage of one bed properties at the more affordable end of the market (around \u00a3450 per week).\u00a0 The Nova building in Victoria, SW1, is in exceptionally high demand and is at the top of many wish lists.\u00a0 Kings Gate Walk, Grosvenor Waterside and 55 Victoria Street are popular too.<\/p>\n

North & North West London (Beaufort Park, Hampstead, Highgate)<\/h2>\n

\"NorthOur Beaufort Park branch<\/a> in Colindale is extremely busy \u2013 in fact we\u2019ve never had such low stock levels.\u00a0 All new instructions are let immediately, often before they even appear on our website.\u00a0 This is mainly because we have an estate agents branch on-site at Beaufort Park and tenants and buyers always come to us first. We\u2019ve been operating in the area for over 15 years now so people know us, trust us and some landlords have been with us since the scheme launched back in 2006.<\/p>\n

We do have a few new instructions coming onto the market but not enough to meet demand so applicants have to move quickly to secure a property.\u00a0 Most are renting properties that won\u2019t be available for another two or so months.<\/p>\n

In Hampstead<\/a>, there is also a shortage of properties, with most properties letting immediately.\u00a0 At times we have had three offers on a single property and applicants are prepared to pay a little over the asking rent to secure a property.\u00a0 \u00a0Prospective tenants really do love the area and some of our existing tenants have lived in the same property for over 10 years so we have very good renewal rates which many of our owner clients, seem to prefer rather than having a new tenant each year. All types of Hampstead properties<\/a> are popular at the moment, particularly 1 and 2 bedroom flats with 2 bathrooms for sharers.<\/p>\n

Call your local Benham & Reeves branch for a free market appraisal<\/h2>\n

The London rental market is fast-moving, now more than ever.\u00a0 Only a local agent can give you an accurate appraisal of the rent your property could achieve in the current market so please contact<\/a> your local Benham & Reeves branch to arrange an appointment.<\/p>\n

READ MORE: Shortage of good rental properties continues in London<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

London\u2019s rental market remains strong, with multiple applicants often \u2018competing\u2019 for the same property and apartments letting immediately in most cases, as long as they are accurately priced in line with current market conditions. <\/p>\n","protected":false},"author":4,"featured_media":20250,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[443,451,445],"tags":[],"class_list":["post-20588","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-landlords","category-london-property-market","category-property-rental-market"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/posts\/20588","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/comments?post=20588"}],"version-history":[{"count":13,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/posts\/20588\/revisions"}],"predecessor-version":[{"id":23498,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/posts\/20588\/revisions\/23498"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/media\/20250"}],"wp:attachment":[{"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/media?parent=20588"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/categories?post=20588"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benhams.com\/news\/wp-json\/wp\/v2\/tags?post=20588"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}