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Up, Up and UP AGAIN - prime London rents soar once more

There are no signs of rental growth slowing in prime London lettings market, says LonRes.

The property data firm says annual rental growth in August was 8.8 per cent across prime London.  

This figure took rents to 29.3 per cent above their 2017-19 pre-pandemic average.  


All areas and sub-markets have seen similar levels of growth but prime fringe was the best performer for the sixth month in a row, recording an annual rise of 12.4 per cent.

Demand remains strong, with a significant proportion of properties being let without listing, meaning they are not captured in the data. However, even with that caveat there are signs that supply is creeping up from these recent lows, with new instructions rising by 6.5 per cent in August compared to a year earlier.  

Lets agreed fell by 21.3 per cent on the same basis, and are almost 60 per cent lower than the levels recorded in 2017-2019.

With the activity metrics impacted by a lack of listings, the data on discounts and reductions may be a better indicator of demand.  

Average discounts across prime London were typically around six to 10 per cent from 2013 to early 2020.  After rising in the early stages of the pandemic they fell sharply through 2021 and in late-2022 properties were even reaching more than 100 per cent of asking price on average in some months.  

While the market appeared to cool slightly on this measure in the first half of 2023 the latest data shows discounts falling again. The prime fringe market looks particularly strong, with average discounts of 0.5 per cent in August.

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    Landlords sell up because of S21, RRB etc so there are fewer properties available. Interest rates rise so Buy2Let landlords have to put rents up to cover those increases, other landlords see rents rising and follow suit. Now who could have seen that coming? Everyone with a grain of common sense, that’s who. Of course that rules out the entire faux Tory government who don’t have a grain of common sense between them.

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    Due to the stupidity of the government policy on squeezing out Buy to Let, this now only works for cash buyers and not many of those exists in London. The fact that you can't claim the mortgage interest off tax, was almost manageable with low interest rates. Now the rates have shot up, you can quite easily be paying 130% tax on property if you are a high rate tax payer. It's like living under a communist regime in property rentals. The situation will just proceed to get worse for renters as landlords off load property in London.


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