For the first time in more than a year, rents in central London ticked up in June, as the market looks to recover after a decade of rental gains were wiped out during the pandemic.
Monthly rents rose 4.3% between May and June—the largest monthly increase on record—leaving the average let in the center of the city at an average of £2,103 (US$2,919), according to a report Monday from estate agency Hamptons.
Despite the short-term boost to values, the average rent is still down £415, or 16.5%, compared to the same time last year.
The catalyst for the reverse in fortune has been tenants returning to the city as the country reopens while stock levels stay low, the firm said.
Last month, the number of tenants registering to rent in central London was up 16% from June 2020 and 45% from June 2019.
The availability of rental stock, meanwhile, is 8% below where it stood two years ago, with single-family homes being particularly hard to come by.
“Over the course of the pandemic, inner London landlords have suffered more than investors anywhere else in the country. But in recent months rental growth here has changed course and is now on an upward trajectory,” Aneisha Beveridge, head of research at Hamptons, said in the report, adding that she expected rents in the center of the capital to return to pre-pandemic levels within 12 months.
“A relatively buoyant recovery has ensued as restrictions have been lifted, but some scarring is likely to remain as tenants become less closely bound to their office desk and international travelers remain in short supply,” she said.
The rental market everywhere outside of London is outperforming the capital. Excluding the city, rents rose 10.9% annually across Great Britain, the fastest rate of growth recorded since 2014, with the most sizable gains in the regions surrounding London: the South East, the South West, and the East of England.
Article Source: Mansion Global