London’s rent frenzy expected to continue until the end of the year
Higher mortgage rates, landlords selling up and canny tenants who locked in low rates during the pandemic are combining to send rents in London’s best districts above their pre-pandemic peaks.
As many as 50 applicants are competing for each apartment that becomes available, about 200 per cent more than in a typical busy market, according to Sarah Tonkinson, a managing director at Foxtons Group in London.
The cost of living crisis is having little impact on the frenzy so far, and soaring house prices are only adding to the pain, forcing more people to rent for longer as they save for a deposit.
“Younger buyers struggle to get on the housing market as rising interest rates and stretched affordability begin to bite,” said Alec Harragin, valuation director at Savills in London. “These buyers have now turned to the rental market.”
With lettings down almost 50 per cent on last year in London’s best districts, the price of leasing a property there rose 25.8 per cent in the year through July, according to LonRes. Rents in those neighbourhoods are now almost 15 per cent above their levels from 2017 through 2019.
Across London, the cost of leasing a place rose 23 per cent in the 12 months through July, Foxtons said in a report. Hotspots include Notting Hill, Shoreditch, Clapham and Stratford, Tonkinson said.
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