Friday, May 20, 2022

London rents climb for the first time in more than a year

London rents

By comparison, rents across the North East rose by £37 to £557 during the same quarter

London rents climbed for the first time in more than a year during Q1 2021 —increasing by £8 or 0.61% to £1,325, suggesting the city’s rental market has started to stabilise during the coronavirus pandemic, according to The Deposit Protection Service (The DPS).

By comparison, rents across the North East, traditionally the most affordable UK region to rent, increased by £37 (7.12%) to £557 during the same quarter, largely due to rents on flats rising by £40 (7.81%) to £552, said the UK’s largest protector of deposits.

The DPS’s quarterly Rent Index shows overall resilience in the UK’s rental market during Q1 2021, with significant rises in Tyne and Wear up £32 (5.78%) to £586 and Merseyside up £31 (5.64%) to £581, while rents in Bristol fell £17 (-1.77%) from £960 to £943 and in Luton by £19 (-2.3%) to £785.

Despite a pandemic flight from cities during the third quarter of 2020, rents across all property types rose during the first quarter of 2021, as well as overall between Q1 2020 and Q1 2021, said the organisation.

Matt Trevett, Managing Director at The DPS, said: The stabilisation of rents in London suggests that the tenants who have decided to leave the city during the pandemic for work or space reasons have already done so, perhaps to live in cheaper areas or to move nearer to, or back in with, family.

We’re aware of significant commitment from media and government organisations to invest long-term in the North, including a number of transport and infrastructure projects, which could well be driving the demand we’re seeing in the region for property, Trevett said.

He said: There remains strong demand for all types of properties, and rents overall across the UK seem to be withstanding pandemic conditions.

UK average rents rose by £8 (1.01%) to £800 between the final quarter of 2020 and the first quarter of 2021 and rose by £25 (3.23%) compared with Q1 2020, with rents falling slightly in Scotland by £3 (-0.46%) to £649.

The North East also experienced the largest (£40 or 7.74%) rent rise between Q1 2020 and Q1 2021, said the organisation.

Average London rents remained static during the first quarter and the second quarter last year before falling by 1.71% in Q3 2020 to £1,322 and by 0.38% in Q4 2020 to £1,317, said The DPS.


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