Frenzy for homes in prime London as stock levels fall dramatically
The number of rental homes available in the priciest parts of London are significantly down in comparison to last year, thanks to frenzied demand.
According to research from LonRes, rental stock was 67 per cent down in January compared to the year before. Similarly, the number of homes for sale was down 16 per cent last month.
It comes as buyers’ interest has once more been piqued by premium properties in neighbourhoods including Fitrozia and Kensington.
This market was hammered hard during the early days of the pandemic as overseas buyers stopped eyeing London properties.
Now, rental prices have surged as the easing of Covid measures has injected renewed energy back into the market. Prices in the rental sector are now 22.5 per cent higher than last January, in a “complete turnaround”.
Accelerating transactions at the top end of the market have pinched supply, with properties with a price tag of £5m or over having returned to transaction levels seen at the 2014 peak.
Anthony Payne, LonRes managing director, said: “Lack of stock both for rentals and sales, continues to dog the prime London housing market. And in a high demand, low supply environment, it follows that prices inevitably rise.
“This is a complete turnaround in fortunes for a sector that was particularly hard hit when the pandemic began. Back then rents fell as fast as stock levels rose. Almost two years on and the lettings market has effectively covered the ground lost during the pandemic.”
While good news for landlords, tenants returning to the capital to work or study have “less bargaining power,” Payne added.