London’s lettings desks were a-buzz in the last three months of the year.
LonRes recorded a 14.5% annual increase in the number of properties let in Q4 2016 across PCL, prime London and prime fringe areas, along with a 14.1% rise in new instructions.
Deal numbers were up across all price ranges, but most significantly at the pricier end; the tally of properties let at £3k per week or more was 19% higher than in the same period last year, with PCL seeing a chunky increase of 28%.
Stock continued to pile up, and at the end of 2016 there were 11% more properties listed in PCL, and 30% more across prime London and prime fringe, compared to the same point a year earlier.
The research team offers a few explanations for this: firstly, “reluctant” landlords choosing to rent rather than sell; secondly, the completion of a glut of new developments, releasing off-plan units onto the market; and thirdly, the fallout from the stamp duty stampede in February and March 2016, as all those pre-deadline buy-to-let purchases gradually filtered in.
“However, it is worth noting that lower levels of buy-to-let activity since April mean that we are now starting to see these properties being absorbed into the market,” the firm adds.
Tenants across all three areas could afford to negotiate pretty hard with all that choice, and paid an average of 7.8% less than the original asking (up from 5.8% a year ago). As such, achieved rental values in PCL were down 3.3% on Q4 2015 (they were slightly up in prime London and prime fringe markets, by 2.9% and 0.4% respectively).
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N.B. Prime Central London includes properties within the following postcodes: SW1X, SW1W, SW1A, SW3, SW7, SW10, W1K, W1J, W8 Prime London includes properties within: NW1, NW3, NW8, SW1P, SW1V, W1T, W1H, W1U, W1G, W1W, W2, W11, W14, Prime Fringe includes: SE1, SE11, SW4, SW5, SW6, SW11, W4, W6, W9, W10