London Rental Market Recovery
The return of business chiefs seeking second homes near their offices has helped to increase the value of rents in prime London locations for the first time in more than a year reports the Telegraph on line.
Demand from the corporate world had dried up following the financial crisis as the City cut jobs. However, with profits and bonuses on the rise again, rents are launching a recovery.
The growth is further evidence of an improvement in the economy and has been driven by locations such as Islington, Hampstead, St John’s Wood and Marylebone. Rental values increased 1pc in the quarter to September 30, the first rise since the second quarter of 2008, as supply of homes for rent also fell.
Rents had slumped by 11.8pc because the market was flooded with properties as homeowners rented out their homes rather than selling them because of the fall in house prices.
However, with house prices now recovering, transaction levels are soaring and rapidly eroding the number of “accidental landlords” looking to rent stock. This has, therefore, cut the supply of properties just as demand is recovering.
Rents on prime flats in Hampstead, St John’s Wood and Marylebone soared by 3.9pc in the past three months.
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