Renting in London: rents see biggest rise since records began in ‘most competitive market on record’

Private rents in London are on the rise at an unprecedented rate. They have risen by 14% in a single year, to GBP2,193 per head, from GBP1,919 last. According to Rightmove, it is the largest annual increase in any region since records began. Prices have risen across London, with the West End experiencing a 34% increase over last year, according data from Flat-sharing website SpareRoom. Rents in Chelsea rose 28%, while South Ken saw a 27% increase. The average monthly rent in South Ken is now GBP1,384. The average annual growth outside London was above 10 percent for the first time. This pushed the average rent up to GBP1,088 per month, a record, compared to GBP982 last year. Swansea in south Wales is a hot spot for rental properties. SpareRoom director Matt Hutchinson said that rents are on the rise across the country, and have already reached record highs in many cities and towns. This is going to be extremely unwelcome news. Many renters are already financially stretched and will be wondering what they will do with higher rents and a sharp rise in living costs. This may be just the beginning. Flatsharers often have their bills included in their rents. London is still experiencing severe shortages of supply due to a decrease in properties on the market and a surge back home after the pandemic. Rightmove reports that demand has increased by eight percent, while available rental properties have fallen by 47%. Rightmove calls this the “most competitive rental market ever”. This is a drastic turnaround from the pandemic when younger renters moved back in to their parents’ properties, flooding the market and causing rents slump. Rightmove claims that there are some “positive signs” that there will be more property choices. The number of rental properties on the market increased by five percent in March, compared with January, and 16% compared to February. There was some hope that rental prices might ease in the coming weeks. Research from Hamptons revealed that landlords are re-entering the market. They had purchased GBP8.5 billion worth property in March, compared to January, and 16% in February. This, in combination with the lower number of homes available for rent, led to the most competitive rental market ever recorded. There are many factors that affect supply and demand. “On the supply side we hear from landlords and agents that tenants are signing longer leases which has prevented some stock from returning to the market. Rightmove’s table of hot rental spots included Swansea, south Wales, topping the list with a 19.% increase in typical asking rents. Manchester was close behind with a 19.% increase. Liverpool saw a 17.% annual increase, while Grantham in Lincolnshire (14%), Cardiff (14%), and Margate in Kent (18.3%) were other hotspots.