Is London’s rental market stabilising at last?

15 April 2021 | Renting

Is London’s rental market stabilising at last?

London rents climbed for the first time for over a year during Q1 2021 —although the rise was a mere £8 or 0.61 on average.

This suggests the capital’s rental market has started to stabilise at last despite the coronavirus pandemic, says The Deposit Protection Service.

However, while that’s gently improving news, rents across the North East, traditionally the most affordable UK region to rent, increased by £37 or 7.12 per cent the same quarter. 

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The DPS’s quarterly index shows overall resilience in the UK’s rental market during Q1 2021, with significant increases in Tyne and Wear up £32 (5.78 per cent) and Merseyside up £31 (5.64 per cent).

Matt Trevett, managing director at The DPS, says: “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.

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

UK average rents increased by £8 (1.01 per cent) to £800 between Q4 2020 and Q1 2021 and increased by £25 (3.23 per cent) compared with Q1 2020, with rents falling slightly in Scotland by £3 (-0.46 per cent) to £649.

Region

Average rent Q1 2021

£ Change since Q4 2020

% change since Q1 2020

London

£1,325

£8

-1.49%

South East

£932

£9

4.13%

South West

£790

£10

4.91%

East

£846

£15

4.19%

East Midlands

£612

£0

4.44%

West Midlands

£647

£0

4.35%

Yorkshire

£549

£3

1.29%

North West

£629

£13

5.89%

North East

£557

£37

7.74%

Scotland

£649

-£3

1.09%

Wales

£610

£4

4.63%

Northern Ireland

£559

£8

7.29%

This post has originally been featured in Letting Agent Today.