Landlord and buy to let: rents in central London up 9.2% (22/07/2010)

Rents in London’s prime residential market rose 9.2% in the 12 months to the end of June 2010, according to property agency Knight Frank.
    The improving picture for landlords continued into the second quarter of 2010, with a rise of 2.6% in the three months to June. However, Knight Frank point out that despite the recent upswing in the market, rents still stand 12.4% lower than the market peak reached in March 2008. Demand and supply dynamics have driven the market – with the number of tenants rising 5% and the supply of new rental stock falling by 25% over the past year.
     “A combination of a slow but steady improvement in the central London jobs market over the past year, and a strong residential sales market, have conspired to create the conditions for rising rents in the prime London market” said Liam Bailey, head of residential research, Knight Frank commented. “Improvements in hiring volumes in the business and financial services sector since last summer have seen a 5% rise in the number of tenants looking for accommodation over the past year, and an 17% rise compared to two years ago.

    “The strength of the market is particularly marked in central west areas, with very strong rental growth in Knightsbridge (17.1% growth), Notting Hill (16.6%) and Chelsea (14.6%). This is a reflection of the improvement in the fortunes of the ‘City’ employment sector since the nadir of early 2009 – these areas are all characterised by strong ‘City’ demand.


By Andy Stern

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