The research shows that as of earlier this week there are some 40,496 rental homes available to rent across London. This equates to four per cent of the capital’s total 1,009,266 rental homes highlighting the slim pickings on offer to prospective London tenants.
The good news is that this low level of stock has, at least, shown signs of increasing, up 21 per cent on a quarterly basis and five per cent annually.
However, in some boroughs of London, the chances of securing a rental property are almost non-existent.
In Barking and Dagenham, there are currently 180 homes listed to let, equating to just one per cent of the borough’s total rental properties.
Across Newham, Haringey, Croydon, Havering, Bexley, Enfield, Redbridge and Waltham Forest, current available rental stock equates to two per cent of total rental properties, climbing to three per cent across Ealing, Hounslow, Bromley, Brent, Hillingdon, Harrow, Sutton and Lewisham.
Across a further 12 boroughs, less than one in ten rental homes are currently available to new tenants, with just Camden (10 per cent), City of London (11 per cent), Kensington and Chelsea (12 per cent) and Westminster (also 12 per cent) home to a higher percentage, albeit available rental stock levels are still scarce.
London may be seeing a subdued rate of growth when it comes to the sales market, but the rental sector has been on fire of late and is buckling under the pressure of huge tenant demand.
A return to normality has seen increased activity from professional tenants, students and foreign renters, all of which have caused stock levels to plummet, making it extremely difficult for new tenants to find and secure a property.
As our research shows, stock levels are scarcest across the capital’s more peripheral, affordable boroughs, but even those with the financial clout to rent in prime central London will struggle. In fact, we’re seeing an average of 37 applicants for every available rental property that enters the market.
At the same time, our landlords have seen a four fold increase in the monthly cost of their mortgage and this will inevitably result in rents climbing higher, otherwise landlords will have to exit the sector. If they do, even less stock to meet demand will also push up rents so it's a tough time to be a tenant whichever way you look at it.
The only silver lining is that the total number of homes to let has started to creep up, however, this increase is simply insufficient when it comes to fulfilling the current appetite for London rental properties.
* Marc von Grundherr is Director of the London and International Estate and Letting Agency, Benham & Reeves *
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This article is just a rehash of what we know already. Tenants are done for 😱😱. Not my problem, my only concern is to my family and myself. Thank god my children don’t rent 👍🏻
Pity he doesn't explain where the solver lining of some increasing stock comes from: I thought many LLDs were selling up, and not all to other landlords.
Perhaps, being London, some is foreign investors?
But a 5% annual rise - how??
Henry S. The stock is coming we are being replaced rapidly this is the whole idea is behind the turmoil.
About 20% Build to Rent already completed, some buying existing 600 Flats in one go.
Lloyds Bank UK biggest, owned of Halifax, Bank of Scotland and UK’s biggest Mortgage lender aim to have 10’000, by end of 2025 just around the corner increasing to 50’000 with-in 10 years.
John Lewis doing 10’000
over Waitrose store’s,
M&S 10 storey on top of Shop in Hammersmith. Barclays, Insurance Companies. Pension funds etc the list is massive.
We are being replaced by Big banks and companies. Their rents will match that, as they will huge admin staff to be paid as well. It is not going to a fair level of service provided, as the gov't will not have all the red tape for them. Whichever way one looks, it is not going to be better for the tenants. Nobody, that is the govt, or shelter tenants will argue with the Big companies, as no-one complains about the heavy pricing of fuel, high bank loan interest or low savings rates, high costs of food and John Lewis consumer products. So no complains against the huge companies. Just the problem with private LL making a little money for their pension.
Problem is these ‘big boys’ won’t be able to build fast enough to match the fall in supply and rising demand here and now or indeed, for at least a decade.
This leaves any Gov with a housing catastrophe to manage and little option other than introduce eviction bans, rent caps and CGT hikes to lock in landlords thus buying time for the big boys to get established. It’s going to get very ugly.
Thank you Michael. And others' comments.
A good point about BTR and I have seen Barratts agree a deal to sell hundreds of new build homes to a BTR investor (Lloyds?).
But have also seen BTR scaling back due to interest rates.
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