Rents for homes in London soar even higher than before the pandemic
According to Savills, a British real estate services company based in London, annual rental prices in London’s premium locations have increased by 11.1% so far this year, the first time this rise has been in the double digits in almost a decade.
South West London witnessed the greatest increase in rental costs, with rents currently 10.3% higher than they were before March 2020. North and East also London witnessed the largest price increase in the last year, with Canary Wharf (23.2%), Shoreditch (19.6%), and Clerkenwell (16.6%) seeing the most significant growth.
“The return of office employees, overseas students, and corporate migration has seen demand for rental homes soar over the previous three months,” said Frances Clacy, research analyst at Savills. “With some landlords selling up in response to regulatory changes and an improved sales market, the scarcity of supply is severe, driving up competitiveness and prices across the board.”
People in London have seen rent hikes when Covid restrictions were relaxed completely and the cost-of-living situation had intensified.
In the recent months, there has been instances when several individuals are bidding well over the asking amount, which the landlord invariably accepts. Identical apartments which have been on the market for a few months are still available, but now are going for £300 to £400 more than the original asking price, making affordable living harder to achieve in London.
Caroline Vile, a resident in North London, tweeted: “My rent increased from £860 to £1,240 on Boxing Day [of 2021]. I work three days each week since I am handicapped and get Universal Credit. My income barely covers my rent and some of my expenditures. The remainder must be paid for using credit cards.”
The supply of housing stock has also deteriorated, exacerbating the issue for those now looking for property in the city. According to TwentyCI, a leading UK data agency, the number of available rental homes is 44% fewer than last year and 25% lower than pre-pandemic levels.
“Not only does this mean potential renters have to hunt across various regions to get a home, but in many instances, rental properties are being let even before they are posted,” said Frances Clacy of Savills. “[With] 64% of the agents poll indicated a drop in stock levels in the previous three months. Landlords have the upper hand, and we are unlikely to see the pendulum swing in favour of renters shortly.”