It might surprise some landlords that the average rents that tenants have had to pay for a rental property in London, are only on average, 7.54% higher than they were in early 2018. But that doesn’t tell the whole story about the London property market. After the Spring of 2018, when the average rent in London was £904 pm, there was a dip in the rents for London property of around 1.1% throughout the Summer and Autumn of 2018 as the credit crunch hit. Interestingly, whilst London rents only dropped by 1.1%, the picture was far worse nationally, as rents dropped by around 10% to 15%, depending where you lived in the UK.
In 2009 and 2010, rents in London remained rather sluggish, dropping a couple of percentage points over those years. However, 2011 and 2012 saw London rents surge by 9.1%, but throughout 2013, rents in London did drop again by a couple of percentage points. As we have passed the third quarter of the year of 2014, we are starting to see a two tier rental market.
Those properties, whose landlords spend time and money on them, maintaining them and improving them, are seeing tenants paying top dollar for them. A lack of decently presented stock available to rent, means rental averages on those properties are rising. However, those properties where maintenance and improvement isn’t a high priority, are suffering with rents slightly dropping and longer void periods.
As we go into the Winter of 2014, average rents in London stand at £949 pm. From a landlord perspective, the steady rise in rents is good news, as are steady rising property prices. As a London landlord, you must look at any buy to let property as a long term investment. Whilst average rents have only increased by 1.26% per year over the last six years, interestingly, property values in London have seen a rise of over 10.4% in the last 12 months (and 17.9% higher than five years ago).
For more information on the London property market, click here.