Super-prime tenancies, that’s tenancies with a £5k+ pw rent, have seen a resurgence during the COVID-19 pandemic with the period between July and December 2020 being the most active in the past seven years.
In total there were 137 such tenancies taken out in London during 2020 – this was down 11% on the 154 taken out in 2019. However, following the onset of the pandemic this changed with 87 tenancies agreed in the last six months of the year.
It underlines how demand has not been dented by the pandemic, according to Tom Smith, head of super-prime lettings at Knight Frank.
He said: “A big driver in recent years has been the rates of stamp duty in the sales market and it is still a big motivation for tenants.
“That rationale is still there and will arguably grow with the extra 2% surcharge that overseas buyers will have to pay from April.”
However the market is now being hit with a lack of supply in areas such as Chelsea, Notting Hill and St Johns Wood.
Smith said that this may improve in the coming weeks as lockdown restrictions continue to ease.
He added: “We are now having conversations with owners who say they would be open to either a sale or a letting and some strong offers are coming through in the sales market now.”