London Rental Market Holds Up Well in 2017

The London rental market has proved resilient in 2017, and despite a year of economic and political uncertainties, demand from tenants remained strong. Marc von Grundherr, Lettings Director at Benham and Reeves Residential Lettings, explains its robust performance.

The London rental market has proved resilient in 2017, and despite a year of economic and political uncertainties, demand from tenants remained strong. Figures from London’s largest independent lettings agency, Benham and Reeves Residential Lettings, show the company saw tenancy volumes up by 19.7% on 2016 and enquiry levels up 16.5%.

 

Several factors contributed to this robust performance, according to the agency, which has 16 branches across London, as lettings director Marc von Grundherr explains: “Our figures show our own performance exceeded expectations in 2017, demonstrating that demand for high quality rental properties is still increasing.    We saw a dip in the number of Europeans moving to London, but this was balanced out by rising numbers of professionals relocating from the US, Australia, Asia, South America, Japan and China.  Tech firms such as Facebook, Google, Apple and Amazon are setting up new offices in London, adding to increasing rental demand while we also saw a rise in the number of international students moving to the capital.”

 

“However, the rental market continues to face challenges and remains price sensitive.” continues Marc.  “Increasingly, applicants expect to negotiate with landlords so rents have remained flat, with many tenants renewing at the same or slightly lower rents.    We are advising landlords to prioritise retaining their current tenant, as avoiding a void is usually the best option in a competitive market. The good news for landlords is that, with tenants prioritising stability, most are renewing their existing tenancy rather than move and some of our branches have been seeing renewal rates as high as 90%.  An average tenancy now lasts two years and three months.”

 

New developments have seen the highest growth in demand from tenants, with the company receiving 74% more enquiries for new build apartments than for period properties. Urban regeneration schemes such as Nine Elms and Battersea Power Station have transformed areas of the capital, creating new ‘hotspots’ where rental demand has really taken off in 2017. This is a trend the company expects to continue and 2018 is also likely to be influenced by the opening of the Elizabeth Line (Crossrail), opening up rental ‘hotspots’ in new locations, often in Zones 3 and 4, with tenants continuing to move out of central London to areas which offer better value for money.

 

“Although 46,000 new build properties have completed in London this year, this falls far short of what is needed, so we expect the demand for rental property to remain strong.” concludes Marc.

 

 

About the author

 

Marc von Grundherr is Lettings Director at Benham and Reeves Residential Lettings, central London’s largest independent lettings agency with international offices in Singapore, Hong Kong, China, Malaysia and India. Established in 1956 in Hampstead London, the company offers a full letting and property management service to landlords and rental investors across the globe. The company also provides related services including tax accounting, snagging and handover service, refurbishment and furnishing packages for rental investment properties.

 

Contact Details:

Marc von Grundherr

Lettings Director, Benham & Reeves Residential Lettings

Tel: 0044 20 7319 9783

Email: info@brlets.co.uk

Web: http://www.brlets.co.uk/international/singapore/

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