The key points for the new RICS UK Residential Lettings Survey Q3 2008:
- Growth in new instructions outpace growth in tenant demand;
- Rents fall for the first time since April 2003 while rental expectations drop to the lowest level on record;
- Gross yields rise as house price falls outpace rental falls.
Here’s are some comments from the London market experts:
Christopher Ames MRICS, Best Gapp & Cassells [Belgravia]
“I would like to give you figures, but haven’t let anything. Asking prices have come down, but there is
nobody looking.”
Mrs Caroline Appleby MRICS, John G Dean [Balham]
“As tenants have a larger choice of properties, it is important that the property is in good condition and is
offered at the correct rental level. Anything that is in a tired condition seems to be rejected.”
Richard Beltran Esq, Chancellors [St John's Wood]
“Fewer applicants are registering in the area, which is a direct result of the financial instability in the
economy: many of our applicants work in banking and choose St John’s Wood because of its closeness to Canary Wharf by tube. Demand for properties over £1000 p/w is slower, but still very busy between £300-£700 p/w”
James Gubbins MRICS, Dauntons [Pimlico/Westminster]
“Renters are not looking to spend as much. Supply is outstripping demand. Rents are reducing as vendors turn to Rentals.”
Benjamin Sloane, Chancellors [Highgate Village]
“There is very little activity on properties renting above £600 per week.”
Tim Henson FRICS, Clarke Hillyer [Walthamstow]
“Typically more owners are choosing to let out their properties as opposed to selling. A lot of people have over-mortgaged and can’t afford to rent out their properties for less than that figure. In the last month or so the market has deadened dramatically, even for lettings, making it harder to achieve the market prices.”
Jeremy Leaf FRICS, Jeremy Leaf & Co [East Finchley]
“Supply and demand for rented flats and houses increased, particularly in the last few months in response
to weakness in the sales market. However, concerns about unemployment have meant that rents have softened and some contracts have been cancelled or not been renewed recently. We expect supply and demand to be more in balance over the coming months as lender rates, as well as mortgage lending criteria, ease.”
Edward Reeve BSc FRICS, Edward Reeve [Pimlico]
“Rents for one & two bedroom flats in the £1350-£2000 per month range have increased but it is apparent there is less demand for higher priced flats over £2600 per month and rents are falling. One recent letting at £2,900 per month was achieved after a 2 month void. The previous letting was £3,445 per month.”
Ben Temple BSc MRICS, Temples (Clapham) Limited [Clapham]
“Summer seemed to have come early this year and then tailed off. We were busier than normal in the early summer months and then quieter in September and October. We have seen an increase in the supply of property, vacancy rates have increased, and rents have started to fall, particularly for larger properties.”
Mark Wilson MRICS, Globe Apartments [London]
“Batten down the hatches. Landlords should expect rents to continue to fall as tenants’ effective demand reduces. Added supply will add to the problem.”
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