London rental market strong but growth depends on easier travel

A generally upbeat trading statement from franchise agency giant Winkworth reports that prime London’s rental market’s long term return to normality depends on Coronavirus travel restrictions easing.

On the sales side Winkworth told shareholders that the final quarter of last year was “brisk” with continued interest despite the end of the stamp duty holiday. 

For the year as a whole, the agency’s sales agreed were 13 per cent higher than in 2020 and 42 per cent above those of 2019.

And it added that on the back of the strong market "we expect to see an increase in approaches for franchises from new applicants.”

However, the statement’s reference to the lettings side was more guarded, saying: “Our rental business experienced some normal seasonal slowdown after several months of intense activity but remained strong in London. Prime Central London continues to show signs of recovery, although the outlook for international interest remains dependent on travel restrictions.”

The agency opened six new branches in 2021; five of these were opened by existing franchisees and the agency now says it "expects our local networks to continue to grow, led by talented, proven and ambitious franchisees whose expansion we are supporting." 

Dominic Agace, chief executive officer, told shareholders: "We are conscious of the rising interest rate environment, but the cost of finance remains at a record low and we believe that there is still pent up desire from households to relocate. 

“Buyer demand over the end of year break has been reported at record levels and sellers finally seem to be returning to the market. 

“While this may hold back the solid growth in prices of the last two years, it bodes well for the number transactions and we expect another busy year."