London rents hit ‘record high’ of over £2,000 per month as shrinking supply hits tenants hard
The cost of renting in London is now 12.1 per cent higher than it was last year, as tenants dish out “record” payments of £2,627 pcm to live in the capital, a new report from Rightmove shows.
Over the last year, lodgers in the capital have seen their rents surge to fresh highs because the number of homes available to let has decreased due to landlords selling up to avoid hefty mortgage payments.
This has led to fierce competition in the renting pool, leading many landlords to drive up costs of their rent and also desperate tenants to over bid on homes in order to secure a place to live.
According to the latest figures, across Britain the number of enquiries each property is receiving from would-be tenants has more than tripled to 25 from eight at this time in 2019.
Overall, the number of tenants looking to move across the UK is 41 per cent higher than in 2019, while the number of properties available to rent is down by 35 per cent.
However, Rightmove said that the supply and demand imbalance is slowly improving from last year, with demand easing by 17 per cent compared with 2022, while available supply is up by 14 per cent over the same period.
Tim Bannister, Rightmove’s director of property science, said: “Record rents and far more tenants looking to move than there are homes available means it will still feel very difficult for many tenants navigating the market.
“However, there are signs that some of the pressure between supply and demand is beginning to ease, with the number of new rental properties coming to the market now at its highest level since the end of last year.”
He added: “While it is likely that there is some way to go before this filters through to rental prices, if the improving trend between supply and demand continues, we could start to see the pace of yearly rent rises slow more significantly than it has been.”
In the last year, the ecosystem of the UK’s housing market has been battered – first by the fallout of last September’s mini budget and then by the central bank’s 14 straight interest rate hikes which sent borrowing costs into a frenzy.
The latest raft of housing reports by the likes of Rightmove and Nationwide have shown that the market has remained largely unchanged. House prices are continuing to fall but at a lesser rate than they had the prior months.
Earlier this week, Nationwide said that the cost of a home in London has fallen annually by 3.8 per cent in the three months to September, narrowing from a 4.3 per cent fall in the previous quarter.