New normal has hit London rental market – Hometrack
The latest Hometrack Rental Market report for quarter 3 2020, based on data from Zoopla, is indicating that while annual rental incomes are on average for the whole of the UK up 1.7% the London market has fallen 5.2%. The latest average monthly rental income for a UK property is now £890.
Lockdown and the pandemic crisis are being factored in as more employees working from home are changing commuting traffic and weaker tourism affect demand in the Capital. Additionally, the search for increased space (gardens and spare rooms for offices) has resulted in a faster-moving market for rented houses over flats, but demand for all rented property is still driving the market faster than in 2019.
The average time to rent a house is now 16 days, down from 20 days last year and time between listing a flat and let agreed is 18 days, down from 20 days last year.
The most popular search terms for rental property have shifted emphasis to space for renters, showing a new top five:
- Gardens
- Parking
- Garage
- Balcony,
- Pet-friendly
David Ross, Hometrack Managing Director, said: “Despite a very clear split between London and the rest of the UK, our research in consumer behaviour within the capital provides some confidence in the longer-term outlook. We’re seeing potential new rental hotspots emerging in extended commuter belt territory.
“However, the impacts of employment vulnerability and decreasing wages nationally may put downward pressure on rental values as we move into next year.
“The rate of BTL lending has moderated to pre-coronavirus levels, with new applications now sitting at 95% of March totals.”
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Landlord case study required for The Telegraph
Member Since October 2020 - Comments: 38
10:36 AM, 10th November 2020, About 5 years ago
Do others agree that if you have invested in a small central flat in one of the new developments in the centre you should not necessarily be considering selling soon? Surely it’s best to just see what the “new normal” turns out to be. It seems clear that the combination of Covid-related changing work habits and the Brexit mess could turn central London into a backwater for a while, but I do not think that will last forever.
Member Since December 2015 - Comments: 259
12:10 PM, 10th November 2020, About 5 years ago
Reply to the comment left by M&SFAN at 10/11/2020 – 10:36
As a non UK BTL investor in London for the last 10 years I can testify to the contrary. In my experience London units are an almost saturated market. Competition is high and this has resulted in falling rentals and falling sales prices. My units have often been vacant between tenants and in order to compete with the 5 or 6 other vacant units in the same development, and ignoring all those in close proximity, a landlord has to provide more to attract tenants. Add to this the cladding fiasco, the Brexit fiasco, the inevitable economic Covid impact and the continuing and incessant anti-landlord legislation and you may appreciate why I consider property the least profitable asset I own. I completed on one unit last year much to my relief but am held hostage by the above on the second. It now stands empty and will remain so until sold which could take at least two years. Considering this is how long it could take to evict a non-paying tenant I’m quite happy to avoid the inevitable tenant damages and costs and stress by paying my mortgage myself whilst enjoying the freedom of an empty unit.