Across the prime London and commuter zone, markets rents continue to soften, but to a lesser extent than seen previously. Demand remains high for properties of the best condition and price.
Rents across the prime market have continued to soften. During the past 12 months, rents in the prime London market have fallen by 2.7%, while rents in the prime markets of the commuter zone have fallen by 1.5%.
In prime central London, where rents have had the largest correction, demand from international tenants remains high. This demand is focused on properties that offer the best amenities, are of the best condition, or present something unique.
The more domestic markets across the rest of prime London, are experiencing higher demand for family houses. Often, landlords are negotiating longer tenancies on larger properties as a strategy to prevent void periods between tenancies.
Prime market rents in the capital’s commuter zone have fallen to a lesser extent. There is strong demand for family houses, from corporate tenants relocating with their families, who want to be near the best schools.
Increasingly, tenants are looking for best-in-class property at the best price, and will be flexible in their choice of location to achieve this. To retain demand, landlords will need to remain flexible in their offering.
Market summary
The prime rental market has continued to see rents soften, falling for the tenth consecutive quarter across the London market.
Over the past 12 months, prime rents across the capital have fallen by 2.7%, with a fall of 1.5% in the prime markets of the commuter belt.
There continues to be a high level of supply across pockets of the market, which is limiting rental growth. Likewise, some areas have also had an increase in accidental landlords – those who have brought property that is struggling to sell, who are renting property instead.
Overall, demand is being propped up by needs-based tenants at the lower end of the market, those at the top end who are choosing to rent rather than buy, and international tenants who continue to see the appeal of having a base in London.
Tenants are increasingly driven by finding the best-in-class property at the best price, and continue to be flexible in their choice of location to achieve this.
To retain demand, there is an increasing trend for longer tenancies. We have seen the average tenancy length across the prime market increase from 15.1 months in 2013/14 to 16.9 months over the past 18 months.
In order to remain competitive, landlords will need to remain flexible and creative in their offering.
If you are relocating to the UK with your family or looking for a new rental property please contact Premier Property Search at enquiries@premier-propertysearch.co.uk or call Nigel Sellers + 44 (0)1962 793100.
