Report reveals shock rise in prime rents since pre-pandemic
Across prime London there were 48.1% more properties on the market to let at the end of February than a year earlier.
Rents grew across prime London again during February, taking values to 26.7% above their pre-pandemic average accompanied by a 14.2% increase in lets agreed and a 17.6% increase in new instructions, latest data from LonRes reveals.
Across prime London there were 48.1% more properties on the market to let at the end of February than a year earlier – although 25.3% lower than the same time four years ago.
Rents
Nick Gregori, Head of Research, LonRes, says: “Once again, the sentiment in the market has been a little more positive than the story told by the latest sales data.
“Agents are telling us they are busy and while we are recording deals being agreed, there seems to be slow progress from offer to exchange which means actual transaction figures remain muted.”
And he adds: “The most positive sales story remains the £5m+ market, where activity is still significantly ahead of the typical levels recorded from 2017-2019.
“February saw 4.2% more transactions than the same month last year but new instructions are also increasing, and at a faster rate. 8.4% more sales listings in February than last year on top of the big jump in January means that available stock in this market has grown by 26% over the past 12 months.”
TIME TO FILTER
Gregori reckons that the impact of the Spring Budget with changes to holiday lets, multiple dwellings relief, and capital gains – plus the abolition of ‘non-dom’ status will take time to filter through but says it ‘seems unlikely’ the changes ‘will shift the dial’ in either dirtection for the prime London market.
He adds: “The lettings market has been supply-constrained for a long time, but so far this year there are emerging signs of new instructions picking up. Stock on the market has grown by almost 50% compared to a year ago.
“Annual rents growth appears to have stabilised at around 3.5% after a few months of falls. And our discount and price reduction metrics are moving back towards what would be considered more ‘normal’ levels.”
