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Hamptons: Inner London rents up 3.9%

Jake Carter

December 13, 2021

landlords

For the first time since January 2020, rents in inner London rose on an annual basis, up 3.9% in November 2021, according to data collected by Hamptons.

However, inner London was the only region in the country where the average rent was still lower than just before the pandemic.

The average property cost 11.6% – or £305 – less to rent than it did in January 2020.

Hamptons estimated that the pandemic has cost inner London landlords £2.9bn in lost rent over the past 22 months.

Since the pandemic began, rents outside the capital have risen nearly three times as fast as those in Greater London (16.1% versus 5.9%).

On a regional basis, the South West saw the strongest rental growth since January 2020, with rents up 23.5%, or £195 per month.

Having recorded eight consecutive months of double-digit growth, the South West continued to top the rental growth league, with rents rising 14.6% over the past year.

In this region there were 42% more applicants looking to rent, and 21% fewer homes available, in November than at the same time last year.

Aneisha Beveridge, head of research at Hamptons, said: “Across Great Britain, rents have risen 7.9% over the last year, marking the strongest rental growth recorded in any November since our records began in 2013.

“A lack of stock and a continuation in tenants’ willingness to pay for more space has fuelled growth.

“In particular, this has benefitted Southern regions (outside of London) which have seen the biggest rent rises since the pandemic began.

“While there are few signs to suggest that stock levels will rise next year, we expect the rapid pace of rental growth to slow as affordability barriers set in and household budgets come under further pressure. We expect rents across Great Britain to rise 2.5% in Q4 2022.

“The pandemic has divided London into a city of two-halves. Rents in Inner London have been hardest hit as the rise of flexible working has seen fewer new tenants move into the capital, while some tenants have moved to leafier neighbourhoods in search of more space.

“But the resumption of office life and opening of global travel marked a turning point for the rental market in November.

“While there’s still a way to go, rents in inner London are on track to reach pre-pandemic levels by the middle of 2022.

“This means, in a reversal of this year, we’re likely to see inner London rents outperform Outer London in 2022.”


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