The cost of renting a property located in one of London’s most prestigious postcodes has jumped 28.3 per cent over the previous year, due to a shortage of rental properties and booming demand.
There are now 50 per cent fewer rental properties hitting the market than before the pandemic, new figures from LonRes show.
The stock shortages come as demand for rental properties in London’s poshest postcodes has begun to bounce back over the previous year, as renters flock back into the capital’s most expensive areas.
The imbalance has caused rents in prime areas of the capital, around Hyde Park and Hampstead Heath, to increase by 28.3 per cent over the past 12 months, to levels that are now 5.6 per cent higher than at their pre-pandemic peak in 2018.
At the same time, house prices in London’s prime areas are now 6.1 per cent higher than they were at the start of the pandemic, in April 2020.
The increase comes as domestic buyers have driven up prices through their willingness to a pay premium “to secure the house of their dreams,” LonRes managing director Anthony Payne said.
Strikingly, properties outside of central London, in areas such as Richmond, have done particularly well compared to those in the city centre, in traditionally pricey areas such as South Kensington and Primrose Hill.
Meanwhile, flat prices have dropped 0.9 per cent since April 2020 – despite having jumped 4.5 per cent over the previous year – amid a scarcity of international buyers purchasing city centre flats in areas such as Chelsea and Knightsbridge.