Over the last few years the London rental market has become increasingly disjointed from the rest of the UK, both in terms of activity and rental levels. Rents in London can be at least twice as high as those for similar property in other areas in the UK. As relocation agents we obviously keep a close eye on rental activity and the high levels of tenant demand in London, the cost of buying and the corporate rental sector are all factors spurring London’s rental values.
The recession has left many UK and international would-be property buyers no choice but to become part of the rental market. The unaffordable and restricted mortgage finance has forced families and individuals to turn to rental properties. We have also seen a lot of families come to us to utilise our rental relocation services as they are forced to relocate nearer to relatives or to a more affordable area.
This positive demand for rental is set to remain unless there is a significant change in mortgage availability from UK lenders.
The latest Royal Institute of Chartered Surveyors (RICS) Residential Lettings Survey highlights how tenant demand has continued to rise throughout the year, keeping rent levels high and expectations amongst its members is for rental levels to still climb in the following months of the year. Surveyors also reported a slight fall in new instructions from the previous month, following 18 months of new instructions rising.
The North West has experienced the highest average rental price growth from June to July growing at a rate of 6.9% – 2.6% over the national average. However, on the opposite side of the country the South West only achieved a 2.5% growth rate. Over the next few months of 2012, surveyors expect to witness London rents rising at a rate of 4.1%, and to reach a rate of 7.8% over the next 12 months.
The East End rental prices took an Olympic leap in the summer months with top rents reaching £1,700 per calendar month, growing at a much faster rate than the other boroughs in London. The Olympics and Paralympics drew a lot of attention to London and the UK, and although demand didn’t achieve the level landlords desired, rents continued to rise.
Our relocation agents see the East End, and London as a whole, offering great opportunities to those looking to rent, with a wide range of high quality developments to choose from. Those who are looking for new job prospects nearby and for young professionals living in the City are most likely to entertain the qualities that the East End and London offers.
As the challenging economic outlook looks set to continue, our relocation agents predict that rental properties are likely to stay in higher demand than purchased properties. Due to the competition and high demand for rental properties, individuals looking to rent in the current market should research their options, have credit check information in place and agree the rental terms as soon as possible, as good quality stock remains restricted.
Relocating to a new area can be a daunting prospect, our relocation agents are on hand to help. You can find out more about our relocation services here.