A lot is being said about the London rental market, but it is important to note there is a significant difference in demand, and property available, across the capital.
How people view Inner London is different from how they view Inner London. It is also fair to say South West London has a very different reputation than North East London.
This isn’t to say that one area is better than another, but it is important to recognise the differences. It is also crucial to realise and recognise what each area has to offer, and who is most interested in these areas.
Rental growth has risen of late
Rental growth for London has remained positive for the fourth month in a row. There has been a rise of 1% compared to January 2020 figures. However, there is a difference between Inner London rents, and Outer London.
The rents for Inner London have fallen by 15.9% in the year-on-year comparisons while for Outer London, there has been growth of 6.2%.
Inner London rents are currently 24% higher than Outer London rents. However, back in April 2013, there was a 100% difference.
With the average cost of Inner London rent standing at £2,213 per month, the rent in this part of the capital is 17% less than the level it was in January 2013.
For Great Britain, there was an annual rental growth increase for the sixth month in a row, rising 4.3%, following on from the 4.1% increase in December 2020.
The South East of England has experienced significant growth in rents
The largest growth in rents came in the South East, with a 10% increase over the year. This is the first-time an area apart from London experienced double-digit growth since records began in 2012.
The fall in supply rental property has led to this situation. In January 2021, compared to January 2020, there is 14% fewer rental properties on offer.
Apart from London, every region experienced double-digit drops in the supply of rental homes to the market between January 2020 and January 2021.
Matt Hutchinson, SpareRoom Director, comments: “We know that London is losing its appeal among young renters, with COVID changing the way we feel about home and how we live. The first national lockdown made people think twice about living in cities, especially London, and it’s clear to see this hasn’t changed. The result is a boom in demand outside London.”
Matt continued by saying; “When we first saw the sign of this we wondered if it was a temporary blip but, as we head into the second year of living with COVID, it’s hard not to see it as a permanent shift and potentially even the start of a new chapter in the UK’s relationship with its capital city. It’s not just that people have left London, it’s that many of the industries that draw them there in such huge numbers are in crisis - that could take years to reverse. The positive in all of this is that it could herald the start of a UK economy that relies less heavily on one city.”
Of course, at Holmes Estate Agents, we cover a wide range of locations across the South West of London. Therefore, we have seen the different aspects of demand. As said above, Outer London is experiencing a difference in demand to Inner London.
No matter what you require assistance with, we are here to assist you, and hopefully make a difference.
We have considerable experience and expertise in the South West of London. We are ideally placed to help vendors, tenants and landlords during this challenging time. If you have any questions regarding the South West London property market, please get in touch with Holmes Estate Agents today.