Rents stalling in London as market cools slightly

Foxtons says London’s market is finally cooling - at least a little - for the Christmas period.

November followed the seasonal downward trend with a 26 per cent reduction in renter registrations from October. However, year to date, demand remained 15 per cent higher than the same period last year. The outer zones of London continued to show higher levels of renter demand, particularly prominent in South and West London, where renter registrations were up 34 and 54 per cent respectively compared to 2021.

In November, the average rent price was £551 per week, the third straight month that average rents have been £550 or more. Whilst this represents a three per cent month-on-month decrease, this price is still 20 per cent higher year on year.

There were 15 renters competing for every new property this November, a 31 per cent reduction compared with October, but still over a third up on the prior year. For the first time in over two years, this figure was lower than the same month in the prior year.

Competition remained high in South London with 31 renters per new instruction, while the East and West regions followed with 28 renters per new instruction.

As applicant demand fell, so did the budgets of potential renters. Despite a one per cent month-on-month decline, applicants had already adjusted their mindsets to expect higher rents, with budgets still seven per cent higher year-on-year. Central and East London continued to have the highest year-on-year increase, at 12 and 10 per cent respectively this November.

Foxtons’ lettings managing director Gareth Atkins says: “With so much debate on rising rent prices, cost of living, mortgage rates and supply shortages, all eyes are on the London Lettings market. There has been a slight seasonal decline in demand, which is usual at this time of year, alongside an unusual, marginal increase in supply.

*There were 15 new renters competing for each new listing this November - historically high demand. In line with a little more property available we have seen rental prices stall, but there’s still a long way to go before we see rent prices move away from recent record highs.”