Londons rental market: current snapshot
Mon 09 May 2022
Paul Bennett, Director
St. John’s Wood estate agent, Behr & Butchoff, uses the latest data and real-time information to roundup the capital’s current rental market.
Why is London’s rental market running hot?
While it’s true the return to office life and greater freedom when it comes to international travel have boosted London’s rental market, there are other factors at play. As estate agents, Behr & Butchoff keeps track of the interest rate and the latest rise to 1% will prompt many tenants to abandon their plans to buy a property.
This issue is most prominent among first-time buyers, with new research from Nationwide Building Society indicating that 70% of people looking to buy their first home in the next 24 months are pausing their purchase due to the rising cost of living and their ability to save for a deposit.
Also keeping tenants in rented property is the ability to secure a mortgage, with news that 1 in 10 private renters have been unsuccessful when applying for a home loan. A survey by Canopy found that 25% of renters were rejected due to a poor credit history and 24% were turned away for not having a substantial enough deposit. In addition, taking out a payday loan scuppered the chances of 15%, while too much debt was the downfall of 13%.
Finally, soaring house prices are excluding many from the home buying marketplace. April marked the tenth month in a row during which property values climbed, with a rise of 1.1%. In London, the latest average house price is now £537,896 – a new record for the capital city, according to the Halifax.
How much does it cost to rent in London?
In a mirror of the house price trajectory, the latest rental index shows that rental values in the UK are also rising – up 1.2% across the country in the last month.
When looking at specific areas, HomeLet’s figures show that demand in London is firmly back on track after the pandemic. Rental prices in the capital rose by 1.9% in the last month, and the cost to rent in the city is 14.2% higher now than at this point in 2021. HomeLet reports an average monthly rent in London of £1,804 but as St John’s Wood letting agents, we have properties to rent in NW London both above and below this benchmark.
What are tenants searching for?
It’s clear to the Behr & Butchoff team that tenants searching in and around St. John’s Wood are not willing to give up some of their newly-acquired lifestyles, despite actively searching in urban locations. It came as no surprise that analysis of Rightmove’s most recent search terms found that ‘pets’, ‘garden’ and ‘furnished’ were all in the top five most searched-for rental aspects.
Behr & Butchoff is increasingly being asked by tenants for pet-friendly properties and our rentals where pets are welcome - such as this two-bedroom apartment in Hampstead – never stay on the market for long.
Landlords of freehold properties - or leaseholders whose properties/blocks don’t have domestic animal restrictions - will find their buy-to-lets are filled much quicker if they are willing to accept a cat or a dog. Demand for all rental properties is currently high, so please contact the St. John’s Wood team today and we can start marketing your vacant let.